At this point, I am looking for selling opportunities yet again.
Litecoin rallied a bit against the US dollar but pulled back at the 50-day EMA to form a shooting star on Monday. This suggests that perhaps we are starting to run into a bit of trouble, perhaps continuing the overall downtrend. That being said, if we break down below the lows of the trading session on Monday, it is very likely that we could go looking towards $100 again.
The $100 level is a large, round, psychologically significant figure that will attract a lot of headline attention, and it is also an area where you have seen quite a bit of support multiple times recently. Because of this, I think it is only a matter of time before we see some type of flush lower from that level, simply due to the fact that it cannot hold forever. A pullback towards that area could cause even more downward momentum, as we continue to see a series of “lower highs.”
Ultimately, if we could break above the $125 level, that would be a bullish sign and a break above the 50-day EMA. That is a reasonable amount of resistance being broken that you would have to stand up and pay attention to. At this point, the market would have to go looking towards the $150 level, an area where we now see the 200-day EMA hanging about. It is also an area where we have seen a lot of resistance previously, so with that being the case I think it is only a matter of time before you would see a bit of a ceiling at that point.
When you look at this chart, you can see just how negative it has been over the last several months, and at this point, it is difficult to imagine a scenario where you would see things change suddenly or easily. Furthermore, you need to pay attention to Bitcoin, which is essentially going nowhere at the moment. You need to see bullish momentum in that market for the rest of crypto to come along with it. It is not even close as to whether or not there is a correlation, because Bitcoin leads the way for the rest of these markets. At this point, I am looking for selling opportunities yet again.