A robust bullish response at an necessary help zone lifted Litecoin above its 38.2% Fibonacci degree, for the primary time because the 19 Could crypto crash. Earlier than setting its sights on the 50% and 61.8% Fibonacci ranges, a market correction was anticipated because of RSI’s overbought nature.
A couple of areas that might set off a promoting response may be discovered on the 4-hour timeframe. On the time of writing, LTC traded at $219.8, up by 15% during the last 24 hours.
LTC 4-hour Chart
Supply: LTC/USD, TradingView
Litecoin’s shut above $190 was supported by sturdy volumes because the alt toppled $200 and $210 with relative ease. Actually, volumes during the last 24 hours clocked in at $5.9 Billion and stood larger than ADA and XRP. The subsequent main goal now rested on the 61.8% Fibonacci degree near the $300-mark. Nonetheless, one other 30% push was unlikely earlier than a wholesome retracement.
Areas that might induce promoting strain had been on the 38.2% Fibonacci degree, and throughout the resistance zone between $233-$245. A retracement would discover the coin on the newly flipped help ranges of $200 and $210. Furthermore, a deeper promoting response might carry $190 again into play.
Reasoning
The RSI ventured into overbought territory and traded at ranges final seen in early-January when LTC snapped a multi yr excessive at $188. By the way, the market suffered a 40% sell-off within the following days. Nonetheless, BTC’s retracement in January had a big function to play again then.
With the king coin now concentrating on a transfer above $50K, such a pointy response by sellers was unlikely. The Superior Oscillator additionally peaked to multi-month highs. When LTC costs do right, an in depth eye have to be stored on this index. A decrease excessive would give rise to a bearish twin peak setup.
Lastly, LTC’s bounce was supported by wholesome capital inflows. The Chaikin Cash Move stood at its highest degree since 26 Could.
Conclusion
The sporadic 36% bounce in simply 4 days was anticipated to ease between $233-$245. Help discovered above $200 will enable LTC to renew its northbound trajectory, transferring ahead. Nonetheless, a transfer in direction of $190 could possibly be harmful. In the meantime, risk-averse merchants can set their take-profits between the aforementioned resistance and lengthy LTC at some necessary help areas.
