LTC/USD facing the ultimate make or break test at $40
- Litecoin price faces the ultimate breakout dilemma; will the breakout rally to $50 or a breakdown to $30 is the most probable?
- The technical picture is neither bearish nor bullish; the RSI sideways movement hints that consolidation could take effect.
Litecoin price has mainly underperformed since a recovery was staged from the lows posted on March 12. While the price crash was devastating for the investors, LTC/USD recovery has not been forthcoming compared to the other major cryptocurrencies in the market. For instance, Bitcoin price has scaled several key levels to test the hurdle at $7,000, Ethereum recovered from $90 to highs around $152 and Ripple approached $0.20 from lows at $0.10. On the other hand, Litecoin has only managed to test the resistance at $40 without much success I sustaining gains above this level.
At the time of writing, Litecoin is trading at $39.41. The intraday bullish action closed in on $40 but hit a wall at $39.44. The price is also testing a critical triangle resistance whose breakout could be the stepping stone for LTC rally above $50. However, the lack of a breakout above $40 could also result in another breakdown below the triangle support towards $30. In this case, it up to the bulls to decide which direction the price would take; will it be towards $50 or a return to $30?
Meanwhile, the RSI is moving horizontally (marginally) below the average level. This clearly shows that at the moment, selling pressure equalizes buying pressure. Therefore, sideways action could possibly take center stage in form of consolidation. The moving averages are above the price where the 50-day SMA and the 100-day SMA will hinder growth at $53.37 and $55.04 respectively.
LTC/USD daily chart