- Litecoin, at press time, was at a critical point, facing immediate resistance at $72 and support levels around the 20-day and 50-day EMAs
- Traders should watch for a patterned breakout to gauge the altcoin’s near-term sentiment
Litecoin [LTC] continued its ascent after rebounding from the $60 support level in early September. The altcoin chalked out a classic ascending broadening wedge on its daily chart as it retested the $72 resistance, at the time of writing.
At press time, LTC was trading at $69.98, down by around 1% in the last 24 hours.
Key EMAs and recent price action
Source: TradingView, LTC/USDT
Litecoin has been on a steady uptrend for the past few months. It recently moved above the 20-day EMA ($69.53) and the 50-day EMA ($67.95) and at press time, was just below the 200-day EMA ($70.69) – A sign of greater buying interest.
The aforementioned price level is quite crucial because if buyers can push above the $72 resistance, the next target would be around $76. This might confirm a patterned trajectory and trigger a near-term decline from that resistance.
Consequently, the altcoin may return to the $68.45 support level. Further declines could occur if sellers enter the market, with additional support at $63.99 and $60.61.
The MACD (moving average convergence divergence) indicator flashed mixed signals. The MACD line was below the Signal line, but both seemed to be in positive territory to indicate a slight buying edge.
A decline below the zero line would signal stronger momentum for sellers. Conversely, a bullish crossover could negate any bearish expectations in the near term.
Derivatives data overview
Source: Coinglass
Derivatives data indicated a hike in trading activity, with volume increasing by 47.32% to $170.12 million. However, Open Interest slightly fell by 2.06%, with a press time value of $249.49 million. This difference suggests traders adjusted their positions amid market volatility, which could mean a major move is coming.
The 24-hour long/short ratio for Litecoin was 0.8629, indicating a slight bearish sentiment overall. However, on Binance and OKX, the long/short ratios were more optimistic, at 1.733 and 2.65, respectively, underlining optimism among traders on these exchanges.
Top traders on Binance for LTC/USDT also had a bullish long/short ratio of 2.0257, indicating that major players expect the price to rise.
Finally, LTC’s price will likely be affected by Bitcoin’s movements. So, traders should keep an eye on the overall market before making any decisions.
