At the time of writing, Litecoin was at a key support level following a strong rejection from the 200-day EMA. A decline below the key support level could expose it to further losses before a bullish rebound is expected. be
Litecoin (LTC) recently faced significant selling pressure following a sharp bounce off the 200-day EMA resistance. Since then, the altcoin has been trending back toward major support zones, attempting a rebound and potentially retesting higher resistance levels.
LTC is trading at $62.86 at the time of writing, down nearly 1.5% over the past 24 hours.
Can the bulls recover lost ground from the recent selloff?
Source: TradingView, LTC/USDT
LTC recently reversed from the $71 resistance level (200-day EMA). This rejection led to a decline to press time levels around $62, which is a key support. The price is hovering around the horizontal support and trend line convergence, which is a relatively important turning point for LTC’s near-term trajectory.
It is worth noting here that the 20-day EMA and 50-day EMA have turned south. If this trend continues and the 20-day EMA drops below the 50-day EMA, it could mean more selling pressure. In this scenario, LTC’s next major support zone would be between $55 and $60.
The Relative Strength Index (RSI) is hovering around 42, highlighting relatively bearish sentiment. Although the RSI is not oversold yet, the recent pullback may suggest that there is still room for selling momentum to play out before the bulls regain control.
The MACD also reaffirmed its bearish momentum as both the MACD and signal line turned south after the bearish crossover. A decline below the 0 mark could lead to further losses for LTC in the short term.
Bulls will need to protect the $62-$63 zone to prevent further decline to $55. However, if broader market sentiment aligns in favor of the bulls, we could see a short-term rally targeting the $68-$70 resistance area.
derived data revealed
Source: Coinglass
The same volume has decreased by 36.22% over the past day. This indicates that trading activity has tapered off, perhaps reflecting high levels of uncertainty among traders. Similarly, the slight decline in open interest of 1.31% over this period suggests that traders are becoming cautious.
The overall long/short position was 0.9608, highlighting a slightly bearish trend. However, this ratio on Binance also revealed a strong bullish edge at 2.4106. This imbalance points to traders’ optimism for a short-term recovery, but a slight short-term tilt could mean further downside potential before a significant recovery.
Traders should monitor trends regarding the EMA, RSI, and overall market sentiment before deciding to buy or sell Litecoin.
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