Litecoin saw a 12.16% price increase, reaching a temporary peak of $58.96. This marked the altcoin’s largest single-day gain since March 29. The rally came as a relief for LTC holders following yesterday’s market-wide decline. However, despite the short-term increase, an evaluation of LTC’s price movements on a 12-hour chart suggests that the token may continue to face downward pressure.
What’s Happening with Litecoin?
As of the date of this writing, LTC is trading at $58.29. Although the token has fallen from its peak of $58.96 on the morning of August 6, it recorded a 10% price increase in the last 24 hours. However, this rally only reflects the broader cryptocurrency market‘s upward trend, as the altcoin faces bearish headwinds.
LTC’s declining On-Balance Volume (OBV) confirms a decrease in token accumulation. This indicator measures the buying and selling pressure in an asset’s market. When it decreases, it indicates that selling pressure outweighs buying pressure, signaling a bearish trend.
Additionally, readings from LTC’s Directional Movement Index (DMI) show that the positive directional indicator (+DI) (blue) is below the negative directional indicator (-DI) (red). An asset’s DMI data measures the strength and direction of a trend. When +DI is below -DI, it indicates that the bearish trend is stronger than the bullish trend. This signifies the presence of bearish market conditions, where selling pressure dominates, making it likely for the asset to continue its downward trend.
Moreover, LTC’s ADX (Average Directional Index) (yellow), which measures the overall strength of the trend regardless of direction, was recorded at 37.90 at the time of writing. When this line is above 20, it indicates that the market trend is strong. Therefore, LTC bulls may find it challenging to move away from the current bearish trend in the near term.
LTC Chart Analysis
Monday’s market decline caused LTC to close at a two-year low of $50. If the prevailing bearish trend intensifies and it loses recent gains, its price may revisit this level or fall further, potentially trading at $49.96.
However, if the market trend changes and bulls regain control, Litecoin’s price could rise to $64.79. In a potential resistance breakout, the first target would be the resistance line at $64.79.
