2019-12-07 2018-06-21 Analysis for LTCBTC: Severe Bears 21.06.2018 Mikhail Hypov 2019-12-072018-06-21

Mid-term forecast. Trends, key levels, the most likely scenario.

In this post, I applied the following tools: fundamental analysis, candlestick analysis, all-round market view, market balance level, oscillators, trading volume.

Dear friends,

It’s getting funnier and funnier in the cryptocurrency world by the day. Whales’ manipulations are so clear that I even feel upset, as I miss something a kind of unpredictable and surprising))

As early as 10 days ago, in the previous post here I said that manipulators can easily get use of the notorious Tether. Everybody has heard or read about this coin’s problems.

Bitcoin’s dropped earlier this year mainly because of the panic, resulted from constant USDT issuance and the lack of any audit.

And suddenly, there appears a document, you may find here, that says, “FSS (author's note – the company’s name) is confident that Tether’s unencumbered assets (author's note – fiat money) exceed the balance of fully-backed USD Tethers in circulation as of June 1st, 2018.”

It is surprising that Bloomberg was the first to create a fuss around this useless scrap of paper; it was one of the earliest to strongly criticize this “document” (see here).

The matter is that Freeh Sporkin & Sullivan LLP (FSS) is a law firm and can’t conduct an official audit. Moreover, this scrap of paper is not an audit report; rather, it expresses the company’s private opinion.

Nevertheless, this news bit about audit passed was spread all over the Internet, and many, without checking any details, started reposting it to share the “joy” with friends and subscribers, without even knowing that they were taking part in informational manipulation.

Amid this self-delusion, I admit that the cryptocurrency market can be flooded by the wave of positive. It is not even about this fake audit, rather, it is about manipulators will to wake the hamsters and make them pay money.

You see, Bitcoin is strongly held at the current levels despite the ongoing negative.

Too many cryptocurrency analysts think this rebound to be temporary, and Bitcoin should reverse close to 7000 USD. Needless to say, manipulators can’t be made a fool of and will certainly punish insolent pessimists, surging bitcoin much higher the above level.

The first signals, like Tether audit, have already been sent, there will be more…

In the context of all these manipulations, I’d like to take a look at Litecoin that is also the market makers’ toy.

First, I’d like to show off a little and emphasize that my last forecast for LTCBTC worked out quite accurately.

Remember, I marked the key level at 0.0175 BTC, whose breakout would result in the bearish scenario (see the chart above), which is now being implemented (see the chart below).

As you see, the trend direction was identified quite accurately. The ticker didn’t followed the worst case-scenario and didn’t dropped down to 0.0133 BTC; but the bearish sentiment is very strong and stable.

To find out whether bears will control Litecoin for long, let’s start with the monthly timeframe.

Fortunately, Litecoin has existed for long enough has a sufficient trading history; so, there are many interesting things in the monthly timeframe.

For those, who’ve never read my articles before, I’ll explain the symbols that you see in the chart above.

I marked bearish divergence with RSI stochastic with the red line.

Red beams mark Keltner Channel’s borders and its centre, the market balance level.

Orange beam indicates the last unclosed low.

Red dots mark the check point in the horizontal volume indicator.

Now, the analysis itself.

As I’ve said, there is bearish divergence that is working out successfully.

The ticker is approaching the market balance level, having met an intermediate support at nine-period moving average (yellow line).

MACD sends sell signal and is at the indicator window top border.

In general, the situation in the monthly timeframe looks bearish; it suggests going down and renewing the current lows. The nearest support level for LTCBTC is at 0.0133.

In the weekly chart, the ticker approached channel’s bottom border, which supports bulls.

MACD is bearish and doesn’t send any reversal signals.

RSI stochastic has been in the oversold zone since April, which indirectly suggests a possible correction in the bearish trend.

In the daily chart, the trend direction is especially clear. The key levels, marked above, display the support and resistance zones.

The first support for bulls at 0.01420 is not a strong barrier to bears. The ticker may rebound from this line within the bullish correction.

In the chart above, you see the unclosed level of 0.0155 BTC (marked with blue beam), it is the first target for the bullish rebound.

Here, I’d like to mark another black candlestick with a long tail at the bottom. Similar candlesticks have been often found for many trading instruments in the recent time. It looks like a bullish hammer, but you mustn’t forget that a hammer is confirmed if the next close is higher than the hammer pattern; it is not so in this case.

Moreover, the candlestick tail indicates the local target for bears, which is convenient for going short.

Let’s look at the LTCBTC oscillators in the daily timeframe.

You see in the chart above that they are also bearish and suggest a deeper dive.

If we compare BTC and LTC trends, we see that, in general, Litecoin performs worse than other cryptocurrencies and weakly correlates to Bitcoin’s move for now. As a rule, no correlation with Bitcoin suggests the ticker’s own fundamental drivers for the rise or the drop.

In the case, Litecoin is clearly pressed down by big traders, so, it is rather risky to buyout the coin at the current levels.

Summary:

In general, Litecoin against Bitcoin looks rather weak. I don’t see any news background or other fundamental reasons for it; therefore, the whales’ just don’t hold the market and dump the cryptocurrency down.

Considering all the above, I think the most likely scenario that bearish correction will continue.

The support level at 0.014 is an intermediate stop, where the market can stay for a while, or even rise a little.

The nearest target for bears is at 0.013 BTC. The price is rather likely to rebound from the level.

The target for bullish correction is 0.0155 BTC; it is likely to be reached, provided there is a bullish correction.

I wish you good luck and good profits!

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Price chart of LTCBTC in real time mode

The content of this article reflects the author’s opinion and does not necessarily reflect the official position of LiteForex. The material published on this page is provided for informational purposes only and should not be considered as the provision of investment advice for the purposes of Directive 2004/39/EC.