Litecoin (LTC) appeared extremely weak when it fell below the 21 Week EMA. The decline was a very sharp and steady one. Debates over value proposition of Litecoin (LTC) began to surface and a lot of investors and analysts were convinced that Litecoin (LTC) might break market structure and fall significantly below $50. However, as the above weekly chart for LTC/USD
shows, Litecoin (LTC) did an excellent job at not only defending key support levels but also forming a strong bottom. The yellow rectangular bar on the above chart shows how Litecoin (LTC) successfully managed to stay above the support at $49.04. In fact, the consolidation is already over for Litecoin (LTC) as it has now formed one candle that is about to close above the yellow rectangle of consolidation.
Technical indicators also look great for Litecoin (LTC) at this point. Wave trend analysis for LTC/USD shows that Litecoin (LTC) is due for a massive breakout that would mark the beginning of a new bullish cycle. RSI also appears to have bottomed out and is now on track for a breakout in the weeks ahead. As we have seen in the past, the month of October is generally favorable for most cryptocurrencies as they begin new bullish cycles and make significant gains. Litecoin (LTC) is well positioned for similar gains as there still appears to be a lot of interest in the cryptocurrency despite debates over its value proposition.
Litecoin (LTC) may continue to see interest from major market players including institutional investors that are looking to diversify their portfolio. However, debates over the past few weeks regarding Litecoin (LTC)’s long term outlook have made it clear to most investors that it is not a long term play. However, given the ease of buying, selling and storing Litecoin (LTC), a lot of new institutional investors might still want to add it to their portfolios for the next bullish cycle. Bitcoin (BTC) has a stronger and more competent developer community compared to that of Litecoin (LTC) but it may still take some time to resolve the problems of scalability, cost and speed that Litecoin (LTC) solves for the time being.
Litecoin (LTC) has finally broken out of a falling wedge against Bitcoin (BTC). The above weekly chart for LTC/BTC
shows that Litecoin (LTC) is on track to begin a new cycle as it trades above the trend line after successfully breaking its falling wedge against Bitcoin (BTC). Wave trend analysis for the above chart also suggests that there is plenty of room for growth. Litecoin (LTC) is highly likely to gain against Bitcoin (BTC) for the rest of the year and might even succeed in reaching a new all time high. RSI for LTC/BTC appears to have cleanly bottomed out and is now ready for Litecoin’s new cycle against Bitcoin (BTC). Short term, Litecoin (LTC) might face resistance at the 21 Week EMA against Bitcoin (BTC) but there is little doubt at this point that Litecoin (LTC) is finally out of the woods and on track for its new bullish cycle.