Litecoin slides below $70 as uncertainty prevails
Litecoin retested March low, but a solid reversal wasn't clear yet as BTC weakened further.
Disclaimer: The information presented does not constitute financial, investment, trading, or other types of advice and is solely the writer’s opinion.
- The crypto market slumped on 17 August, liquidating over $1 billion in positions.
- LTC was brought down below $60 and reclaimed by the time of writing.
The core reason for Bitcoin’s [BTC] recent freak price slump isn’t quite clear. However, the drop to $25k triggered a massive sell-off across the market, including Litecoin [LTC]. LTC dropped below $60 before partially recovering to $65 at the time of writing.
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BTC reclaimed $26k at the time of writing but had breached key trendline support, reinforcing further weakening for the king coin. According to Coinglass, the crypto slump led to over $1 billion worth of liquidations of positions over the last 24 hours before press time.
LTC recovers partially at March low
A Fibonacci retracement tool (yellow) was plotted between July high and the recent low. The lower long wick shows that sellers gained ground, but buyers came in to prevent a further drop. At the time of writing, LTC traded at $65, equivalent to March lows.
The On Balance Volume (OBV) edged lower, capturing the decline in demand for the asset. Similarly, the Relative Strength Index (RSI) was stuck in the oversold territory and showed no signs of imminent reversal.
So, LTC could consolidate the losses between $56 and $70 in the next couple of hours/days if BTC doesn’t record more losses.
Although a foray above $70 could show bullish intent, bulls could only gain an edge above $75. The $70 and $78.5 are key resistance levels, while $50.5 and $42 are key support levels.
Longs discouraged
How much are 1,10,100 LTCs worth today?
Any quick impulse to collect LTC at discounted prices was highly discouraged. As per Coinglass’s liquidation data, over $300k long positions were wrecked in the last four hours before the time of writing.
Before that, a whopping +$16 million worth of longs suffered liquidations. The short-term bearish sentiment calls for bulls’ caution and tracking of BTC movement.
