LTC Technical Analysis: A Negative Signal for Traders Ahead, Past Rally Should be Booked

Ankita  |  Nov 22, 2021

Litecoin (LTC) is a cryptocurrency that was designed to provide fast, secure, and low-cost payments by leveraging the unique properties of blockchain technology. The cryptocurrency was created based on the Bitcoin (BTC) protocol, but it differs in terms of the hashing algorithm used, hard cap, block transaction times, and a few other factors. Litecoin has a block time of just 2.5 minutes and extremely low transaction fees, making it suitable for micro-transactions and point-of-sale payments.

Let us see how LTC has performed and its technical analysis.

Past Performance

The two-month-long rally of Litecoin ended in the early days of November. The price experienced high volatility for one week, after which a correction has started.

The LTC coin opened at $279.24 on November 15, 2021. After a week of price correction, it closed on November 21, 2021, at $221.77. The LTC prices dropped by 20.58% during the past week.

TradingView Chart

LTC Technical Analysis

Looking at the previous week’s price movement, we can say that the current momentum of price is downwards. This may be a negative signal for the short-term traders as the price is expected to drop further in the coming days. However, let us first look at what the indicators have to show us.

A downwards line can be seen in the OBV graph, which is in alignment with the price chart. This means that the price is likely to decline in the coming days.

Looking at the RSI graph, we can see that it is moving near the equilibrium right now. This is a signal that the trend may reverse itself or continue to move downwards. This is a neutral signal.

In the MACD graph, the height of the histogram is increasing, but in a negative direction. This is confirming the previous week’s downtrend. However, this is also a negative signal for the traders.

Recently, the Litecoin Foundation has taken some interesting decisions: in July 2021, the Litecoin Foundation acquired a 9.9% stake in WEG Bank AG via TokenPay, a platform that offers simplified crypto-fiat transfer solutions.

Day-Ahead and Tomorrow

While not necessarily the fastest digital currency among the mega-cap cryptocurrency networks, Litecoin remains a great option for those looking to transfer significant sums of money. This crypto network has been shown to process transactions approximately four times faster than Bitcoin (CRYPTO: BTC).

FIB retracement shows that the LTC price is being tested today around the pivot at $217.7. The next lower Fib level will be at previous support at $199.29, while the next higher level will be at $236.11.

The indicators are predicting that the price is likely to move downwards in the upcoming days, as the market’s momentum is negative for LTC. If the price breaks the support at $199.9, the traders may place a stop-loss at $170. However, if the price takes support from the $199.9 level, and the trend reverses, the price may reach at least $250.

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