ANALYSIS: Litecoin market overview: LTC/USD double-bottom pattern gains are unsustainable
- The double-bottom pattern saw Litecoin make headway above $120.
- Litecoin is likely to move sideways above $117.50 support as suggested by key technical levels.
Litecoin fell victim of the rollercoaster rides that have been swaying the crypto market in all directions in the past week. The initial drop from the 2019 high at $146 found support at $110, in turn, allowing recovery. While LTC/USD recovered above $130, the momentum lost steam short of $140.
The selling pressure on Monday and Tuesday this week resulted in declines below $127 support area aided by a confluence of the 50 Simple Moving Average (SMA) and the 100 Exponential Moving Average (EMA). Further declines dropped under the 100 SMA support at $122 while $115 support zone did little to prevent losses which found balance at $112.5.
A reaction to the completed double-bottom pattern found on Wednesday Asian trading hours saw Litecoin make headway above the support area. A break occurred past $120 hurdle but the momentum fizzled out at $112.5 with the upside capped by the 100 SMA.
A correction from the intraday high has led to LTC dropping under $120 to the current market value $119. The bulls are battling to hold on to the support provided by the 50 SMA. However, the gradually slopping Relative Strength Index (RSI) means that the selling pressure is outperforming buying power. A positive signal coming from the Moving Average Convergence Divergence (MACD) suggests that Litecoin is likely to move sideways above $117.50 support. Other key support areas to look out for are at $115 – $112.50 $110 and $100.