LiteCoin Is Fireing A Classic Buy Signal Right Now

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LiteCoin Is Fireing A Classic Buy Signal Right Now

Signals That You Can Bank On

Signals. Signals are the bread and butter of active traders. The problem for traders is that really good signals don’t come around that often and, when they do, you have to be watching the charts when they happen to maximize their value. Today, while flipping through charts looking for something interesting I spotted a signal in the making. More than just a single indicator or pattern, this signal is supported by a host of factors that point to a reversal in Litecoin.

The cryptocurrency market began to move higher a few weeks ago. The market popped last weekend, perhaps sparked by a flight-to-safety trade seen around the world, and now traders are wondering what will happen next. Looking at the Litecoin chart that next move will be upward and it could be strong. Better, the charts looks like this move could have legs and take LTC back up to the $60 range.

Consolidation, Continuation, And Convergence

The entire cryptocurrency market is in consolidation following last week’s big moves but the LTC chart looks special. The first clue is the candlestick pattern. Assuming today’s candle closes at or near its current level (as of this writing) LTC is forming a Rising Three Methods. The Rising Three Methods is a well-regarded continuation pattern that is often seen during up trends.

The next clue is the moving average, in this case the 30-day EMA. The price of LTC/USD has been bottoming and with it the down trend in the EMA. The price action is above the EMA, a clue by itself, and the EMA is beginning to curl upward, another clue. The two clues together make a pretty convincing signal from the moving-average perspective but there is more.

The MACD is bullish which is good. What’s better is the MACD is showing strength through convergence. Convergence is when the MACD momentum indicator makes a higher peak coincident with price making a higher peak. In this case, MACD is setting a convergence with today’s candle, the final candle in a bullish chart pattern, so the potential for sharp upward price movement is even more likely.

There are more than one signal in the MACD than convergence in the histogram. The MACD oscillator, from whence the histogram is derived, is trending up and forming a bullish crossover. This shows underlying strength in the market, a shift from bullish to bearish, and leaves plenty of room for the market to run higher.

Stochastic is showing some volatility and that is to be expected, prices made a big move and entered a quick consolidation. The general indication is bullish and trending higher, the set up is one that will lead to a strong bullish crossover providing price action moves higher and soon. If prices can move higher and close higher a price-reversal will be confirmed.

Litecoin has Given a Buy Signal

So many altcoins have gone vertical in the past couple of weeks that I have had to adjust my scales in almost all cases, to accommodate the current stratospheric prices when compared to prices just a couple months ago.

Litecoin

Here is the 3 hour chart for litecoin. As you can see, the 2 nd arc, of the 2 nd pair, stopped the rally and then stopped it on the 2 nd test of the same arc more recently. However, barring an unexpected reversal in the next 10 minutes, price will finally close above the arc pair, suggesting a buy signal on the 3 hour chart. Resistance is seen in the $13 area.

Here is a look at a daily chart of litecoin. The daily chart has not yet given a buy signal, but price is very close to that first arc. Resistance is seen at

$13 here as well.

RIPPLE

Ripple stole the show a couple days back with a monster rally that took it very quickly to above the top of a setup on a 3 hour chart (Poloniex). This growth was clearly unsustainable and a pullback was overdue. We got one. However, my guess is that this asset will resume a bull market in the not-distant future.

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Dash continues to disappoint it’s fans. Just yesterday I was hopeful that support would be found at the $60 area, but now it appears that the bear setup is in control, and price will retreat all the way to the 3 rd arc pair of that setup,

BITCOIN

Finally, let’s look at bitcoin.

Bitcoin has shown strength as it has rallied to the 2 nd arc pair of a bull setup (shorter-term). The 1st arc pair has stopped the advance for now, but there is cause to watch this asset closely. If the rally gets going again, the 3 rd arc is all the way up to

Remember: The author is a trader who is subject to all manner of error in judgement. Do your own research, and be prepared to take full responsibility for your own trades.

The Cryptocurrency Market Is In Distress, The Time To Buy Is Now

A Buying Opportunity Of Historic Proportions

Just when you though cryptocurrencies couldn’t move any lower they do, but for no apparent reason. Bitcoin, Ethereum, Litecoin and the other top ten currencies have all shed nearly 10% in the hours leading up to this post and look like they could keep moving lower. The reason is simple, the public has not come back to the market and may not without some positive catalyst to drive them. The good news is that there are multiple catalysts on the horizon that will help public awareness, perception and availability.

The biggest problem weighing on the minds of traders and the public alike is storage, and hacking. Yet another major exchange has been hacked to the tune of millions and there is no end to the wave of crime in sight. This poses a major problem as it makes owning the coins very risky without even considering the fact they are an emergent technology. If you can’t hold them safely then why hold them all is the general thought. The answer of course is to hold your tokens safely in your desktop based wallet, not in your trading account, and use CFDs to speculate the market.

What this means for buyers, owners and holders of cryptocurrencies is that an historical opportunity is developing. Cryptocurrency prices have entered a zone that many technicians, myself included, never thought they would again. Litecoin is in the lead on the march lower, having broken through a major support level and confirming a bearish triangle. This move is indicative of lower prices and could take LTC/USD down to retest the $50 level it was trading at before the 2020 run-up in price, a potential drop of 45% from current prices.

Ethereum is doing better, having found support well above its long term low. This token is now confirming support at that level and establishing its dominance as a market leader. While LTC is expected to recover as the network expands, ETH is expected to shoot higher later in the year as a trio of major upgrades help it reach scale and improve transaction speed. A move below $475 would be bearish but only in the near term. Longer term ETH is likely to move up and retest its highs.

Aside from technical catalysts, upgrades to the system, both ETH and LTC face regulatory catalysts as well. A recent statement from the SEC, coupled with activity in England, has paved the way for Ethereum and Litecoin based futures products to be listed on US exchanges. Listing on US exchanges means access to institutional traders and enhanced liquidity for the entire cryptocurrency market.

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