What you need to know:
- Litecoin ended the day bullish, showing strong upside momentum with price action targeting the $80 resistance zone.
- On the weekly time frame, Litecoin remains bearish and trades below the major moving averages.
- The RSI and MACD indicate continued downward pressure, suggesting that any rebound could remain corrective without a reversal.
Litecoin (LTC) rallied towards the $80 resistance level during Thursday’s trading session after closing higher the day before, signaling near-term bullish momentum even as weekly technical indicators remained firmly bearish.
The move comes amid cautious market conditions, with traders keeping a close eye on whether the recovery can continue or stall below key resistance levels.
According to CryptoWZRDa crypto analyst, Litecoin’s daily chart shows increased momentum despite higher timeframe signals still showing downward pressure.
In terms of LTC’s most recent trading session, the price action does not appear to have reversed the trend, especially considering that general market sentiments are still dictated by Bitcoin.
As for Litecoin’s next steps, analysts say its direction will depend on how Bitcoin’s overall market performs, as Litecoin has always followed Bitcoin’s volatility.
However, analysts say that Litecoin’s rise could trigger further upward moves in the coming days, but a decline for Bitcoin would quickly halt Litecoin’s upward movement.
Also read: Litecoin (LTC) drops after bearish weekly close as recovery from $71.40 resistance limits
The technical outlook of Litecoin (LTC) shows a bearish weekly structure
On the weekly time frame, the LTC remains strongly bearish, as evidenced by the fact that the price continues to trade below all three major weekly moving averages, all of which are trending down and act as dynamic resistances. In fact, the general price resistance created by all three major weekly moving averages, ranging from 90 to 96, continues to keep the price of LTC in check.
Source: Trading view
Furthermore, volatility indicators continue to highlight the risks of further downside moves. LTC’s price movements were close to the lower Bollinger Band, which normally accompanies strong bearish trends and not a reversal.
While the price could find some support in the lower band at the bottom of the range around the low $60s, analysts have emphasized the need for the price to move above the mid-band around the $90 price.
RSI and MACD strengthen the bearish momentum
Momentum indicators further support the cautious outlook. The Relative Strength Index (RSI-14) is hovering around 35, remains below the neutral level of 50 and is approaching oversold territory. Although selling pressure appears to be easing, the downward moving average of the RSI signals trend weakness rather than reversal.
Source: Trading view
The MACD indicator (12, 26, 9) has a strongly negative configuration, where the MACD line is well below the signal line and the histogram remains negative. This indicates that selling pressure has not yet abated; therefore, the upward trend has not been confirmed.
Why this is important
Litecoin’s recent price rise towards the $80 price level indicates near-term buying interest. However, the bearish readings of Litecoin’s RSI and MACD make the price’s upward sustainability questionable. LTC’s bearish structure and link to Bitcoin’s price make the downside risks to its price significant.
Also read: Litecoin (LTC) drops 1.8% as Bitcoin trends impact key price levels from $68-$80
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