Litecoin recovery derails as prices take U-turn at $93
Disclaimer: The information presented does not constitute financial, investment, trading, or other types of advice and is solely the writer’s opinion.
Litecoin [LTC] has put traders in a fix lately. The bullish rally from mid-May was interrupted at $95 before hitting the $100 likely target.
Similarly, the drop on 24 May turned into a bear trap, as over $800k in short positions were wrecked on 26 May after LTC rebounded from $84.
At press time, the recovery hit $93 and made a U-turn, putting bulls that targeted $95 or $100 into another fix.
In the meantime, Bitcoin [BTC] continues to face price rejection at $28k as long-term investors locked gains at the level. With this in mind, what are some levels to consider for LTC in the next few hours/days?
Will sellers extend gains?
LTC has been oscillating between $75 and $100 since mid-March. This allowed traders to target range extremes. However, lately this has become impossible, with BTC unable to move beyond $28k.
Although the 4-hour chart’s market structure was bearish, the higher-timeframe charts were neutral. That means the price could go in either direction at the current $89 level.
If BTC holds on to $27k and surges, Litecoin could rebound from $89 and bounce slightly to $93 or $95 price levels. A strong move to $100 (red supply zone) could be likely if BTC moves into $28k decisively.
On the contrary, LTC sellers could extend for gains at $84 or the range low near $75 if BTC drops to $26k again.
Meanwhile, the RSI fell below the median 50-mark, denoting heightened selling pressure. However, the OBV edged higher, suggesting increased demand for LTC.
Long positions in a dilemma
How much are 1,10,100 LTCs worth today?
Over $800k worth of short positions were wrecked in four hours as of press time. However, short positions suffered less than $400 liquidations in the same period.
This underscores the increasingly bearish bias at press time, which could give sellers more leverage to extend extra gains beyond $89. However, if BTC doesn’t drop below $27k, LTC’s rebound could be likely. Hence, it would be worth tracing this front before making moves.