Litecoin just tested the lower trend line of the massive triangle it has been trading in. The pink dash by price at the lower portion of the triangle labeled d200 is the 200 MA on a daily time frame. As you can see price did break and currently has one candle that closed below it. Now it is time to see if price is going to bounce or hold and stay in the triangle, or are we going to see a breakout to the downside. The blue (4 hour 20) red (4 hour 50) and orange (4 hour 120) moving averages are trying to catch up to price at the moment. We will have to wait and see if price stays at the lower portion of this triangle and forms a bear flag. If that happens, price would allow the moving averages enough time to catch up. Having an area of consolidation and failing resistance on the lower portion of the triangle could be what leads to a potential break to the downside.
Currently I only have one very small short position in the cryptos and that is in Ethereum because comparatively it has been the weakest of the major coins with downward price moves. For now I am flat Litecoin and I am waiting to see what is going to happen in this market in the short term. If price action in this market does not breakout of the triangle soon, you can see that price will be pinched by the intersecting trend lines and the moving averages. If price starts getting pinched by the intersecting trend lines and the moving averages at the same time with small ranging consolidating days, we could see some large ranging days develop from that.
The dotted trend lines on the chart are parallel trend lines to the upper down trend line of the triangle. I left them on the chart because price has continually used them while moving lower. The horizontal blue lines below the triangle are areas where price could go if price breaks lower. The first horizontal blue line would be a test of the low made on 02/06/18. I am also still looking for the set ups with price action and the moving averages as I stated in my last post called Litecoin Stuck Between Moving Averages. Let's watch and see where the market leads us. This is not a recommendation to make a trade.
Currently I only have one very small short position in the cryptos and that is in Ethereum because comparatively it has been the weakest of the major coins with downward price moves. For now I am flat Litecoin and I am waiting to see what is going to happen in this market in the short term. If price action in this market does not breakout of the triangle soon, you can see that price will be pinched by the intersecting trend lines and the moving averages. If price starts getting pinched by the intersecting trend lines and the moving averages at the same time with small ranging consolidating days, we could see some large ranging days develop from that.
The dotted trend lines on the chart are parallel trend lines to the upper down trend line of the triangle. I left them on the chart because price has continually used them while moving lower. The horizontal blue lines below the triangle are areas where price could go if price breaks lower. The first horizontal blue line would be a test of the low made on 02/06/18. I am also still looking for the set ups with price action and the moving averages as I stated in my last post called Litecoin Stuck Between Moving Averages. Let's watch and see where the market leads us. This is not a recommendation to make a trade.