Litecoin (LTC) is at a decisive technical crossroads following a prolonged WXYXZ corrective structure that has shaped its price action since December. Now, multiple indicators suggest a potential trend reversal, with bullish momentum building on both the 4-hour and 1-hour charts.
Bullish Signals Emerge
A complex corrective phase appears to be concluding, with wave Z potentially completing a final C wave. Notably, the Relative Strength Index (RSI) has exhibited bullish divergence since March 31, forming higher lows while price made new local lows—a classic sign of bearish exhaustion and an impending trend shift.
Additionally, the descending trendline from February’s highs remains a crucial resistance level, closely aligning with the 0.618 Fibonacci retracement level at $86.86. A confirmed break above this confluence zone would validate the end of wave Z and signal the start of a new five-wave impulsive rally.
Litecoin Price Outlook
Zooming into the 1-hour chart, a completed five-wave bearish impulse leading into wave Z was followed by a sharp rebound, hinting at the formation of wave (i) in a new bullish sequence. The subsequent pullback into a higher low around $81 suggests wave (ii) is forming, setting the stage for wave (iii) to commence.
If bullish momentum persists, wave (iii) could drive LTC past $86.86, targeting $92.00 (1.272 Fibonacci extension) and $98.15 (1.618 Fibonacci extension). Following a minor retracement in wave (iv), wave (v) could push prices toward the $100 psychological level.
Key Levels to Watch
- Immediate Resistance: $86.86 (0.618 Fibonacci retracement)
- Major Resistance: $98.15 (0.5 Fibonacci retracement, wave (iii) target)
- Short-Term Target: $92.00 (1.272 Fibonacci extension of wave (i))
- Immediate Support: $81.00 (wave (ii) potential higher low)
- Critical Support: $78.00 (wave Z low)
- Invalidation Zone: Below $70.79 (0.786 Fibonacci retracement)
Failure to hold $81 as support and a drop below $78 could indicate that wave Z is still ongoing, opening the door for further downside toward $70.79.
Also Read: Litecoin (LTC) Struggles Amid Market Volatility: Will a Breakout or Further Drop Follow?
As Litecoin tests these critical levels, traders await confirmation of a breakout, which could determine the cryptocurrency’s next major move.
Disclaimer: The information in this article is for general purposes only and does not constitute financial advice. The author’s views are personal and may not reflect the views of Chain Affairs. Before making any investment decisions, you should always conduct your own research. Chain Affairs is not responsible for any financial losses.
I’m a crypto enthusiast with a background in finance. I’m fascinated by the potential of crypto to disrupt traditional financial systems. I’m always on the lookout for new and innovative projects in the space. I believe that crypto has the potential to create a more equitable and inclusive financial system.
