The Litecoin (LTC) price has decreased since reaching a new yearly high in July. The decrease validated the $100 horizontal area as resistance.

Litecoin is now trading close to an ascending support line that has been in place since July 2022. Whether it breaks down or bounces can determine the future trend.

The analysis of the weekly timeframe indicates an undetermined outlook due to both the observed price movement and the indicator readings.

The price action appears bearish as Litecoin (LTC) could not maintain its breakout from July. Although the price briefly exceeded $100 (red), it soon retreated below this level.

This established the $100 mark as a resistance point and set off a continuing downward trajectory. This decline following a failed breakout often leads to significant downward moves.

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LTC’s price is currently hovering around an upward support line that has been in place for 434 days. Given the lengthy existence of this trendline, whether Litecoin rebounds or breaches, it could dictate its future trend.

The price fell below the line last week but created a long lower wick (green icon), bouncing and reclaiming the line in the process. The lower wick is considered a sign of buying pressure. 

Should the trendline break, there’s a potential for a 25% drop to the $50 support level. Alternatively, a rebound could trigger a 50% increase toward the $100 resistance.

The weekly Relative Strength Index (RSI) proves the ongoing downtrend. Traders use the RSI to evaluate momentum and decide if an asset is overbought or oversold. An RSI above 50 during an uptrend often suggests bullish sentiment, while a value below 50 indicates the opposite.

Recently, the RSI dropped below 50 after displaying a bearish divergence (green line) during the previous deviation. This divergence occurs when a decrease in momentum accompanies a price increase, further emphasizing the potential for a bearish trend.

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On August 2, Litecoin underwent its third halving, reducing LTC block rewards from 15 to 6.25. This adjustment heightened the rarity of the asset.

However, despite the deflationary impact of the halving, the price of LTC actually decreased in the week following this occurrence. This could potentially be attributed to miners initiating a sell-off.

The daily timeframe also provides a mostly bearish outlook. The ongoing decrease caused a breakdown from the $70 horizontal support area. Previously, the area had provided support since the beginning of the year.

Therefore, the breakdown from it could cause the aforementioned decrease to $50.

However, despite the bearish price action, the RSI increases the price significantly. The RSI is currently at 23. While this is below 50, the value is extremely oversold (green circle).

In fact, the RSI has not been this low since the March 2020 crash. So, it is possible that a local low is close or has already been reached. However, the price has to reclaim the $69 horizontal area for the trend to be considered bullish.

Hence, despite the LTC price prediction suggesting that the price will fall to $50, reclaiming the $70 area will mean that the trend is still bullish.

In that case, the price can increase by nearly 50% and reach the $100 area.

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The post This Litecoin (LTC) Signal Has Not Been Seen Since March 2020 – What Does It Mean? appeared first on BeInCrypto.

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