Litecoin Price Analysis: 21 May

Disclaimer: The findings of the following analysis are the sole opinions of the writer and should not be taken as investment advice

Litecoin’s [LTC] price has appreciated by almost 70% since the beginning of the year. Despite recent volatility in price, however, the digital asset has managed to attain a stable ground on the charts, with LTC trading at $205.20, at press time.

Over the last 7 days, the crypto dubbed ‘digital silver’ fell by almost 33%. While it has not yet managed to recover completely from its massive fall, at the time of writing, it was trying to maintain its recent gains.

Litecoin [LTC] hourly chart 

Source: LTCUSD on TradingView

Litecoin’s hourly chart highlighted that LTC’s price has been moving within a parallel channel lately. This channel acted as a restrictive range of its immediate support and resistance at $196 and $226, respectively.

As the price remained within this range, the short-term structure for the LTC market appeared to be moving sideways.

Reasoning

Thanks to the selling pressure in the market, the cryptocurrency’s value had fallen on the charts a few days ago. However, with volatility leaving the market, the price, at press time, was consolidating. This low period of price action was highlighted by the Bollinger Bands since they were compressed – A sign suggesting that the price was not experiencing any wild movement.

On the contrary, the momentum, although positive, remained extremely low. Low momentum with low volatility will push the consolidation phase of LTC further. Meanwhile, the Relative Strength Index suggested that selling pressure was still fairly high with a reading of 43. The indicator was close to equilibrium, however, and with a little push from the buyers, LTC may reach a stable market.

Conclusion

Litecoin’s market, at the time of writing, was seeing the market move towards consolidation. LTC’s price has already established support at $196.55 and resistance at $226.75. With volatility escaping from the market and momentum dropping, LTC may continue to move along this range unless a sudden shift in market trend is visible.