Hi friends! Welcome to this update analysis on Litecoin! the fork is expected to happen today, and LTC is still trading inside of a big bull flag on the four hour chart. I've zoomed into the current price action, so that you can see exactly what is happening here. Yesterday, LTC appeared to be forming a cup and handle pattern into the top of the flag, but just as it was trying to break out, BTC began to pull back and LTC turned back with it. However, don't be discouraged, my friends. You can see that, in the process of pulling back from the cup and handle, a bullish wedge has formed, as indicated by the rising dotted trendline. This is very interesting price action, as we can see three bullish patterns in the same formation. HOWEVER, that doesn't guarantee a bullish breakout! That's why I always say, we never want to trade patterns, until the breakout actually occurs. Right now, LTC is chopping around inside of the flag, and chop can be a deadly thing to trade. Wait for the flag to breakout.
There are some interesting changes occurring inside of this flag pattern, that are worth discussing. First, we can see that LTC has pierced the 20 EMA (in blue) but it is currently rallying higher. At the same time, LTC also violated the center line of the rising channel. So, essentially, those two levels have just been weakened as support. You can see how resistive the center line of the channel was, particularly during the inverse head and shoulders pattern, so it's important for the bulls to hold above the that level. I've extended the flag out, to show where price action may continue going forward. You can see that the bottom of the flag will soon be converging with the 50 EMA (in orange.) If we happen to get down there, the bulls would really need to see the 50 EMA hold, or a breakdown of the flag could occur. Such a movement, would put the bottom of the pink uptrend channel in play.
Volume continues to fall, which is typical for price action inside of a flag pattern. This is especially true when there is a converging apex, such as the one created by the bullish wedge inside of the flag. The MACD has crossed over bearish, but is not showing any powerful momentum. This chart remains in a bullish posture, but a breakdown is ALWAYS possible. That's why WE WAIT FOR THE BREAK BEFORE WE TRADE.
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-
There are some interesting changes occurring inside of this flag pattern, that are worth discussing. First, we can see that LTC has pierced the 20 EMA (in blue) but it is currently rallying higher. At the same time, LTC also violated the center line of the rising channel. So, essentially, those two levels have just been weakened as support. You can see how resistive the center line of the channel was, particularly during the inverse head and shoulders pattern, so it's important for the bulls to hold above the that level. I've extended the flag out, to show where price action may continue going forward. You can see that the bottom of the flag will soon be converging with the 50 EMA (in orange.) If we happen to get down there, the bulls would really need to see the 50 EMA hold, or a breakdown of the flag could occur. Such a movement, would put the bottom of the pink uptrend channel in play.
Volume continues to fall, which is typical for price action inside of a flag pattern. This is especially true when there is a converging apex, such as the one created by the bullish wedge inside of the flag. The MACD has crossed over bearish, but is not showing any powerful momentum. This chart remains in a bullish posture, but a breakdown is ALWAYS possible. That's why WE WAIT FOR THE BREAK BEFORE WE TRADE.
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-