At the time of writing, Litecoin is at a critical point, facing immediate resistance at $72 and support levels near the 20-day and 50-day EMAs. Traders should keep an eye on patterned breakouts to gauge short-term altcoin sentiment
Litecoin (LTC) continued its rally after rebounding from the $60 support level in early September. As of this writing, the altcoin has choked out the typical rising wedge on the daily chart as it retests the $72 resistance level.
At the time of writing, LTC is trading at $69.98, down about 1% over the past 24 hours.
Key EMAs and recent price trends
Source: TradingView, LTC/USDT
Litecoin has been on a steady upward trend for the past few months. It has recently surpassed the 20-day EMA ($69.53) and 50-day EMA ($67.95), and is slightly below the 200-day EMA ($70.69) at the time of writing, indicating increased buying interest. It’s a sign.
The aforementioned price levels are very important because if buyers are able to break above the $72 resistance level, the next target will be around $76. This could confirm the patterned trajectory and trigger a short-term decline from that resistance.
As a result, the altcoin could return to the $68.45 support level. Further decline is possible if sellers enter the market, with additional support at $63.99 and $60.61.
The MACD (Moving Average Convergence Divergence) indicator flashed mixed signals. The MACD line was below the signal line, but both appear to be in positive territory, indicating a slight buy edge.
A decline below the zero line would indicate strong seller momentum. Conversely, a bullish crossover can cancel out bearish expectations in the short term.
Derivative data overview
Source: Coinglass
Derivatives data showed an increase in trading activity, with volume increasing by 47.32% to $170.12 million. However, open interest fell slightly by 2.06%, giving it a value of $249.49 million at press time. This difference suggests that traders have adjusted their positions amid market volatility and could mean a big move is coming.
Litecoin’s 24-hour long/short ratio is 0.8629, indicating slightly bearish sentiment overall. However, the long/short ratios for Binance and OKX are more optimistic at 1.733 and 2.65, respectively, highlighting the optimism among traders on these exchanges.
The long/short ratio of top traders for LTC/USDT on Binance is also bullish at 2.0257, indicating that major players expect the price to rise.
Finally, the price of LTC can be affected by Bitcoin trends. Therefore, traders should look at the overall market before making a decision.
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