Litecoin (LTC) tries to bounce back after being rejected by the long-term resistance

Litecoin (LTC) has turned down since being rejected by the long-term resistance zone of $ 238.

Litecoin is expected to consolidate between the current local highs and lows before finally breaking out.

Litecoin’s long-term level

The weekly chart shows that LTC has declined since reaching a high of $ 246.40 on Feb. 20.

The rejection happened right at the 0.618 Fib retracement level, measured from an all-time high.

Despite the subsequent rejection and decline, technical indicators remained bullish. Both the RSI and the Stochastic oscillator are increasing.

While the RSI has produced a bearish divergence, the result is a drop that has occurred. It is possible that LTC will also produce a potential bullish divergence at its next low.

Weekly LTC / USD chart | Source: TradingView

Current movement

Tradaer Altcoinsherpa has outlined an LTC chart, indicating that whether or not the price will successfully break above the $ 186 level will determine the direction of the next move.

Source: Twitter

A look at the daily chart shows that LTC is trading inside the $ 180 area, previously acting as a resistance. While the LTC is still in the process of validating it, the area is expected to act as a support.

However, the technical indicators have not been decided yet. The RSI has just crossed below 50 and the Stochastic oscillator can create a bearish cross.

Hence, a breakdown or bounce of LTC from the $ 180 zone will be a key factor in determining the next trend.

Daily LTC / USD chart | Source: TradingView

Wave count

The number of waves indicates that LTC has completed the third (white) extension of a bullish impulse starting March 2020.

LTC is likely to be in wave four. It is expected to continue to correct before it is likely to break out again and attempt to hit new all-time highs.

If a correction (wave four) could develop into a triangle or a running flat, LTC could have bottomed out.

LTC / BTC

The weekly chart shows that LTC / BTC is trading very close to the all-time low of ₿0.003.

The technical indicators are showing signs of bullish reversal, evident by the bullish divergence in the weekly RSI. However, the trend cannot be considered bullish until LTC recovers to its previous breakout level at 0.0055.

Doing so will confirm that the long-term trend is bullish.

Weekly LTC / BTC chart | Source: TradingView

Conclude

Litecoin is expected to continue to consolidate before finally breaking out.

While LTC / BTC is showing signs of strong bullish reversal, the long-term trend cannot be considered bullish until it breaks above 0.005.

Five reasons why Litecoin is ready to shine again

So far, Litecoin has been one of the weakest performers in the top 10 by market cap during the recent altcoin season, but this seems to be about to change.

This is why Litecoin is ready to shine once again and could soon become the most prominent coin in the industry.

Why is Litecoin lagging behind the rest of the market?

Markets are cyclical, and capital flows will flow from one asset to another. In a crypto bear market, cash flows often tend to move back to the dollar in order to avoid risk.

Altcoins will suffer strong selling pressure from the bears and Bitcoin will retain more value than other coins. But when sentiment is positive, altcoins often outperform Bitcoin by a sizable margin, over so-called altcoin seasons.

Another altcoin season is upon us, and even meme-based assets like Dogecoin are up 800% in just one day. Ethereum has set new all-time highs and most of the other top ten cryptocurrencies by market cap have soared. Even XRP, a coin currently reeling from being treated by the SEC as an unregistered security, saw a rise.

Meanwhile, one of the oldest coins on the market and one of the top ten assets by market cap for most of its lifetime, continues to lag behind the market. But Litecoin could be preparing for something bigger.

Litecoin has a bad reputation in the crypto market, both in terms of being unprofitable to investors recently and due to the coin’s founder dumping his hold at the top of the market. last price.

It leaves a tart taste and tarnishes the digital silver’s reputation. But technically and fundamentally, Litecoin is ready to split.

Basic and technical elements for FOMO fuel for digital silver

According to data from Grayscale Investments, the amount of BTC held over the past 30 days has increased by more than 40,000 BTC. ETH holdings decreased by 6,000. However, Grayscale added 150,000 LTC around this same time period, a good boon for the price.

The asset supply is not as scarce as Bitcoin, but at only 84 million LTC, it is still a small amount for the demand from institutions.

Technically, Litecoin has broken above a large symmetrical triangle spanning many years, and is expecting a target of close to $ 700 per LTC.

Weekly LTC / USD chart | Source: TradingView

A breakout of current resistance levels (in red) on the USD pair, will also trigger the confirmation of an Adam and Eve bottom formation (blue) pattern.

A similar pattern can form on the LTC / BTC trading pair, along with the formation of a descending wedge pattern. Technical indicators are also bullish, with the RSI likely to create a hidden bullish divergence and the monthly MACD histogram almost cutting up the positive territory.

Monthly LTC / USD chart | Source: TradingView

The MACD crosses up indicating that momentum has changed and buying is likely to increase. As is the case with Bitcoin and Ethereum, once an asset starts to increase, the FOMO is triggered with historical comparisons.

Previous all-time highs have been conquered, and many coins including Bitcoin and Ethereum have entered price discovery mode. Is that the next thing about Litecoin?