Litecoin falls beneath a bullish order block, could $40 be next target
Disclaimer: The knowledge offered doesn’t represent monetary, funding, buying and selling, or different sorts of recommendation and is solely the opinion of the author.
Only a week in the past, Litecoin [LTC] rallied to the $61 stage however confronted rejection there. This was a bearish improvement, particularly for long-term traders. The market construction continued to stay bearish, and the psychological $50 stage has been defended prior to now few days. Nonetheless, promoting stress started to climb as soon as extra.
LTC- 12-Hour Chart
Supply: LTC/USDT on TradingView
In Might, LTC shaped a spread from $61 to $74 (white). One week into June, the lows of this vary failed to carry. The wave of intense promoting noticed Litecoin drop as far south as $40.2. Within the following weeks, the worth noticed a rally again to the $61 space.
The Fibonacci retracement ranges (yellow) plotted confirmed the $61 mark to be the 61.8% retracement stage of the transfer from $74 to $40.3.
Furthermore, the $61 space was additionally the low of the vary shaped in Might. The confluence of those two resistances was sturdy, and LTC confronted rejection from the $61 zone.
LTC- 4-Hour Chart
Supply: LTC/USDT on TradingView
The rejection from the $61 space was anticipated to seek out some assist within the $51-$52 space (cyan field). This was a zone of demand, and it additionally had a bullish order block on the four-hour chart. Furthermore, this zone was simply above the longer-term horizontal assist stage at $50.4.
Due to this fact, we now have confluence as soon as extra between the bullish order block and a horizontal assist stage. But, the worth bounce was solely a weak one from this zone.
On two events prior to now few days, a bounce was witnessed. Every of the bounces was unable to shut a buying and selling session above $54. On the time of writing, the worth appeared to slide beneath each the $50.4 assist stage in addition to the demand zone above it.
Supply: LTC/USDT on TradingView
The four-hour Relative Energy Index (RSI) slipped beneath the impartial 50 line a couple of days in the past and retested the identical as resistance. This instructed that the momentum had swayed in favor of the bears. The Chaikin Cash Circulate (CMF) additionally agreed and confirmed that the previous few days have seen important capital circulation out of the market.
Then again, the On Stability Quantity (OBV) didn’t present heavy promoting stress. In reality, over the previous week, it has been capable of climb increased on the charts and noticed solely a minor dip over the previous three days.
Conclusion
The value motion of LTC in current buying and selling classes confirmed that the $50-$52 space was an important space of assist. If there was a session shut beneath the psychologically necessary $50 stage, it might see Litecoin start to tumble a lot decrease down the charts.
Due to this fact, aggressive sellers can look to enter quick positions on a session shut beneath $50, with a stop-loss simply above $52. The Fibonacci retracement stage at $48 might provide some weak assist, however beneath it, the $40 space beckoned.
