Swarms of Goldfish Nibble Whale's Fins — LITECOIN! (LTC)
Hi friends! Welcome to this often imitated, but never duplicated, update analysis on Litecoin! Let's get right to it. Looking at the four hour chart, you can see that LTC currently appears to be following the path of the small inverse head and shoulders pattern, which was introduced on yesterday's analysis. However, I'm still skeptical, particularly because BTC is producing some slightly bearish action, as it tests a critical level on it's chart. If Bitcoin is going to remain under pressure, I don't feel very confident in this small inverse head and shoulders pattern. Regardless, you can see that the previous candle made contact with the neckline, but LTC has turned back to test support at the 50 EMA (in orange.) At the moment, the 50 EMA appears to be holding. If it breaks down, however, we could see an attempt to complete the inverted cup and handle. On the chart, you can see that the handle could still materialize. It wouldn't take much for LTC to break below the 50 EMA right here, and begin to head lower. With that said, if we do get a breakdown from the bottom of the inverted cup and handle formation, it could be violent. There is a decent support level around 169, but a break below there could send LTC much lower, potentially to test the top of the downtrend channel (in blue.)
That's why I've been saying that it's best to remain on the sidelines, in the safety of cash, during indecisive action like this. You can see that the volume is dropping, as an increasing amount of traders step aside, until some real direction emerges. With that said, we need to wait for a break back into the pink uptrend channel, or a breakdown of the inverted cup and handle formation. Trading anything until then, is risky.
To highlight how important it is, to be on the side right now, I want to draw your attention to the enormous downside risk. If we do roll over, and break down from the inverted cup and handle formation, we could literally see a loss of 50% or more, from the current levels. A test of the top of the downtrend channel, in blue, could occur around 110 or so, which is about 50% down. I'm not saying that those levels are going to be reached, I'm just showing you that it's a possibility, if we see a hard breakdown of the inverted cup and handle formation. On the bright side, LTC appears to be fulfilling the path of the inverse head and shoulders pattern, which could send it up to the pink channel, with the help of the little gold fishies, of course.
If you wanted to trade either of these directions, for educational purposes only, you could place a buy order on a breakout above the neckline of the inverted head and shoulders pattern, with a stop order just below the neckline. On the downside, you could short LTC, on a break below the cup and handle formation, with a stop order just above the breakout level. In both trade examples, the potential gain surpasses the risk. Personally, I wouldn't go long until I see a break back into the pink uptrend channel. But I'm a cautious trader.
I read an article yesterday, in which the author was confused as to why LTC was under pressure ahead of the Litepay launch. It's called "buy the rumor, sell the news." Perhaps that's what we'll see. Either way, lets wait for the chart to give us some real direction, with a breakout of one pattern or the other. I'm the master of the charts, the professor, the legend, the king, and I go by the name of Magic. Au revoir.
This has been your not-so-humble market wizard, droppin' knowledge like bombs in this place! Please follow, comment, like, and share on social media. Good luck trading everyone!
***This information is not a recommendation to buy or sell. It is to be used for educational purposes only.***
-MPC loves you-
-JD-
That's why I've been saying that it's best to remain on the sidelines, in the safety of cash, during indecisive action like this. You can see that the volume is dropping, as an increasing amount of traders step aside, until some real direction emerges. With that said, we need to wait for a break back into the pink uptrend channel, or a breakdown of the inverted cup and handle formation. Trading anything until then, is risky.
To highlight how important it is, to be on the side right now, I want to draw your attention to the enormous downside risk. If we do roll over, and break down from the inverted cup and handle formation, we could literally see a loss of 50% or more, from the current levels. A test of the top of the downtrend channel, in blue, could occur around 110 or so, which is about 50% down. I'm not saying that those levels are going to be reached, I'm just showing you that it's a possibility, if we see a hard breakdown of the inverted cup and handle formation. On the bright side, LTC appears to be fulfilling the path of the inverse head and shoulders pattern, which could send it up to the pink channel, with the help of the little gold fishies, of course.
If you wanted to trade either of these directions, for educational purposes only, you could place a buy order on a breakout above the neckline of the inverted head and shoulders pattern, with a stop order just below the neckline. On the downside, you could short LTC, on a break below the cup and handle formation, with a stop order just above the breakout level. In both trade examples, the potential gain surpasses the risk. Personally, I wouldn't go long until I see a break back into the pink uptrend channel. But I'm a cautious trader.
I read an article yesterday, in which the author was confused as to why LTC was under pressure ahead of the Litepay launch. It's called "buy the rumor, sell the news." Perhaps that's what we'll see. Either way, lets wait for the chart to give us some real direction, with a breakout of one pattern or the other. I'm the master of the charts, the professor, the legend, the king, and I go by the name of Magic. Au revoir.
This has been your not-so-humble market wizard, droppin' knowledge like bombs in this place! Please follow, comment, like, and share on social media. Good luck trading everyone!
***This information is not a recommendation to buy or sell. It is to be used for educational purposes only.***
-MPC loves you-
-JD-