Disclaimer: The following article attempts to analyze the emerging patterns in the Litecoin short-term market and its impact on price.
Litecoin witnessed a boost in its value as the price of Bitcoin [BTC] rose on the charts. However, it has not managed to overcome its losses from earlier in September. Despite the low range movement, LTC overcame an important price point at $49.48, which was now its support. The digital asset was valued at $49.94, at press time, as its resistance remained at $51.41.
The value of Litecoin currently was consolidating between $49 and $51. The Bollinger bands indicated reducing volatility in the market, while the signal line was indicating a trend reversal may be on its way.
The converging bands indicated that the price action was getting restricted as the rising price was noting a dip. The signal line that had laid under the candlesticks for the past few days suggesting the price moving higher, might be crossing above the candles, indicating the reversal in the price trend.
This reversal in price trend could be due to the growing selling pressure in the market indicated by the Chaikin Money Flow. For the past week, the indicator had remained well in the positive territory noting a buying pressure in the market, however, on 13 October, the CMF dipped under zero and was at -0.07, noting the evolving selling pressure in the market.
Interestingly, the placement of the 50 moving average suggests that the bullishness in the market has not yet lost steam and might return to push LTC’s value. However, in order to be in a full swing, the asset will have to break away from its resistance at $51 and surge higher. The resistance has been tested only twice since the crash in September, which meant it may take some more time to breach past it.
Meanwhile, in the current period, the point of control for LTC’s value was lower at $46.24 as it was a highly traded range. The current price is not receiving much volume and may head towards the support at $48 before re-testing the resistance.