LTCUSD is still stuck in the middle of its descending channel on the 4-hour time frame but might be ready to test the top again. Price is turning higher and finding support around $175.
The 100 SMA is still below the longer-term 200 SMA, though, so the path of least resistance is to the downside. In other words, the selloff is more likely to resume than to reverse. In addition, the 200 SMA is right in line with the channel resistance near $200 to add to its strength as a ceiling.
Stochastic is pointing up to signal that buyers are regaining the upper hand for now while RSI is also turning higher to reflect bullish pressure. However, sellers could return once both oscillators indicate overbought conditions. Note that the top of the channel lines up with a former support area as well.
Dollar weakness has contributed in part to the small bounce among cryptocurrencies as jawboning from Treasury Secretary Mnuchin led to another wave lower. To top it off, data was mostly weaker than expected so doubts about the Fed’s tightening plans lingered.
So far, LTCUSD and its peers are still waiting for stronger catalysts that could revive the market rallies but for as long as the selloff continues, more and more headlines appear to be exacerbating the tumble.
The focus is still on South Korea’s crackdown, with the government more recently announcing that t will no longer be entertaining foreigners on its platform. In India, authorities are now going after cryptocurrency investors to collect taxes.
In the absence of any positive headlines, LTCUSD could continue to trade sideways or crawl lower inside this descending channel, but a strong upside break past the resistance could be enough to build some bullish momentum to revive the longer-term climb.