- Litecoin correlation with Bitcoin provided bullish breakout at the start of the week
- Further optimism sparked over the launch of crypto services in UK by PayPal
- Bearish pattern appears after LTC yesterday’s high at $191.94
Litecoin price analysis suggests that the token is at a critical point of resistance amid a bullish start of the week for the crypto market. LTC is currently trading at $179.93, having fallen from the established key resistance point of $190 yesterday.
The strong run for Litecoin has been associated with its correlation to Bitcoin. Both tokens have a correlation of almost 1, owing to the blockhain operation of both at the same time and the use of LTC as a proxy blockchain for BTC by some investors. As the largest cryptocurrency in the world extended above $50,000, Litecoin also continues to dart higher. Further encouraging market movement was as PayPal enabled crypto services, including LTC, for users in the United Kingdom earlier in the week.
The larger cryptocurrency market faced some correction today as Bitcoin fell 2.67 percent back to sit just above $48,500. Ethereum followed a similar pattern, falling 2.5 percent, along with Altcoins Cardano, Ripple, and Polkadot dropping around 4.5 percent each. The biggest dip was seen in Dogecoin, as it dropped 6 percent to sit at $0.29.
LTC/USD 24-hour price chart: End to a promising bull spell on the cards
The 24-hour chart shows bearish signs to come for the token, spelling the end of a bull run that set LTC above its 25 and 50-day moving averages. After consecutive highs over the past 48 hours, propelling buying rate up to $192, the last 24 hours saw a decline from $186 down to $179.3. The price still stands higher than the Moving Average (MA) of $179.63, which suggests the trend is still upwards.
The lower Bollinger Band value significantly sits at $145, suggesting price is almost near its resistance point. The Relative Strength Index (RSI) sits just below 60, exhibiting slight over-valuation in price.
LTC/USD 4-hour price chart: A double-top appears
On the 4-hour price chart, LTC shows bearish signs as a double-top pattern appears on the 4-hour chart, which usually indicates that a change in bullish trend is about to take place. The first top on the 4-hour chart can be seen at the $188.70 mark, followed by a spiral down to $180.86.
Another top appears at $190.3 on August 23. The current 4-hour candle shows price dropping from the previous low, confirming a double-top pattern. However, the price still lies above the 25 and 50-day moving averages, along with a rising Moving Average Convergence Divergence (MACD).
Litecoin price analysis conclusion
Litecoin price looks set to face a bearish trend over the coming days, breaking a positive spell that broke previous support levels at $162 and $175. Resistance currently sits at $190-192, and any buyer propelling would have to approach the mark to break the downward trend. As price goes down, new short-term support is set to be found around $178 before buyers are expected to gather momentum.
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