Litecoin (LTC) has finally done it. The price has found a true bottom at the exact price of $50. This has been tested a number of times now according to the daily chart for LTC/USD
above. Some might argue that finding a bottom is a process and not a price target. I agree with that in the case of Bitcoin (BTC) but Litecoin (LTC) seems to have found a bottom in terms of price. This also means that the price is not expected to trade further down the falling wedge from here onwards and will now have to break the triangle to begin a new trend.
Litecoin (BTC) has tested downtrend resistance two times since the correction. The third time it runs into the downtrend resistance, it is expected to break it and begin a new trend. RSI for LTC/USD has trade in a consolidation pattern. Litecoin (LTC) has had a very stable correction compared to most altcoins. The LTC/USD chart shows that until May, Litecoin (LTC) refused to correct in the same vigorous manner as the rest of the market. After that when market structure was broken, Litecoin (LTC) plunged deep into the red same as the rest of the market.
The last correction has made people very conscientious as to the actual worth and use cases of the cryptocurrencies they invest in. Litecoin (LTC) is one of those cryptocurrencies with a dubious future as it does not have its own distinct use case like Monero (XMR) or Ethereum Classic (ETC) has. In fact, it is more like Bitcoin Cash (BCH). A lot of credible merchants today accept Bitcoin Cash (BCH) the same way they accept Bitcoin (BTC) because Bitcoin Cash (BCH) is cheaper and faster, for now. What happens when Bitcoin (BTC) becomes as fast and cheap? What happens when the gold rush concludes and people actually start working on making Bitcoin (BTC) faster, cheaper and stable as the one universal currency for goods and services? Will Litecoin (LTC) still have a use case?
It is true that Litecoin (LTC) may not have a use case if Bitcoin (BTC) overcomes the problem it has set out to solve. However, many argue that Bitcoin (BTC) will take a lot of time to resolve those problems and before that happens, Litecoin (LTC) and those backing Litecoin (LTC) will profit off its temporary use case, especially when demand for fixed supply coins is increasingly rising. The chart above for LTC/BTC
on the daily time frame shows that Litecoin (LTC) is all set for a trend reversal against Bitcoin (BTC) soon as it breaks out of the falling wedge it is trading in.
As we saw during the dot com boom, the early investors could back anything and they would come up on top. It was easy to make money during the early days. As time went by, investors became picky about the companies they wanted to back. As a consequence of this, we have seen companies like Yahoo that once dominated the search engine and instant messaging space lose big time to Google and Skype. The same is going to happen in this industry. We are still in the early phases and it may not matter much whether you buy Litecoin (LTC) or Monero (XMR) today, but in a few years from now, it most definitely will.