Disclaimer: The following article attempts to analyze the emerging patterns in the Litecoin short-term market and its impact on price.
With the beginning of a new month, the cryptocurrency market has been witnessing a resurgence. Litecoin, the digital silver has been breaking out of a pattern, and given its strong correlation with Bitcoin, if the rally continues the digital gold and silver may be at the receiving end of increased volatility.
Source: LTC/USD on TradingView
The short-term chart of Litecoin was noticing a boost in its price as it broke out of a falling wedge. The price of Litecoin had been descending over the past couple of days and the wedge-shaped trend lines are considered useful indicators of a potential reversal in price action by analysts and looking at the above chart, the trend reversal took place as the price tested support at $59.50.
As the price bounced back from this point, it has given rise to an ascending channel. The price of Litecoin was $62.16, at press time, as it pushed passed its immediate resistance at $61.16. However, the digital silver was forming a part of an ascending channel, which looking at the Relative Strength Index, has pushed LTC in an overbought zone. The push has reversed the trend from a bearish to a bullish one.
Source: LTC/USD on TradingView
This bullishness was confirmed by the 50 moving average as it slid under the price bars. The visible range highlighted dominant and significant price levels based on volume, in the given time period. The chart noted that $61.152 was the Point of Control [PoC] with the higher traded volume. The second most traded point in the current chart was at $61.23, which could be a support level if the price collapses. However, the trend reversal will cause the price to slash, until then, LTC was rejoicing in a bullish market.
