Litecoin (LTC) price has fallen below its long-term ascending support line and is at risk of losing key horizontal support at $60.
The direction of the further trend will depend on whether LTC breaks through this area or bounces off it.
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Litecoin price falls below long-term support
Technical analysis of the weekly timeframe gives a predominantly bearish forecast. The main reason for this is the Litecoin price falling below the 427-day ascending support line in early August. Exit from such long-term structures often indicates the end of a trend and the beginning of a reversal.
Despite the breakout, LTC is still trading inside the $60 horizontal area. Since May 2022, it has periodically acted in both support and resistance roles. The last bounce from this line resulted in the formation of a long lower wick (it is marked with a green icon on the chart)which is considered a sign of buying pressure.
A rebound from the $60 area or a fall below it will be a key factor in determining the direction of the further trend. The first scenario could result in a 55% rise to long-term resistance at $100. The second is for a fall of another 25% to the nearest support at $50.
Source: TradingView
The weekly relative strength index (RSI) confirms the possibility of further decline. The indicator is below 50 and falling, which is a sign of selling pressure.
LTC Price Prediction: Bullish Divergence Hints at Reversal
Analysis of the daily timeframe gives an ambiguous forecast.
On the one hand, the price has fallen below the descending resistance line since reaching a yearly high in July. This is considered a sign of a bearish trend and will likely take LTC to new lows.
On the other hand, the daily RSI is giving bullish signals. The indicator bounced off the trend line and formed a bullish divergence (it is marked with a green line on the graph)and also went beyond the oversold zone.
Source: TradingView
Thus, Litecoin price prediction will depend on whether it breaks the descending resistance line or falls below the $60 area.
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2023-09-08 14:40:00
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