Nearing Bottom? Litecoin Prices Consolidating After Rough September

Litecoin’s price has had a hard time in the fallout of China’s initial coin offering (ICO) ban.

While both bitcoin and litecoin took a hit after the early September statement from Chinese regulators – followed by domestic cryptocurrency exchanges voluntarily ceasing to offer services in the aftermath – bitcoin quickly recovered and neared record highs against the US dollar this week.

As litecoin support struggled, bitcoin seems to have benefitted from the rotation out of ether and ethereum-based tokens, triggered by fears of China-like ICO restrictions in other jurisdictions.

Against the U.S. dollar, litecoin is now down by more than $40 from its record high of $98.28, achieved on September 1. Further, the litecoin-bitcoin (LTC/BTC) exchange rate fell from 0.019 BTC (September 2 high) to 0.0098 BTC this week.

At press time, LTC/BTC is trading at 0.0105 BTC – down 0.9 percent on the day. Week-over-week, the pair is down 13.22 percent, while on a monthly basis, it is nursing a 34 percent loss.

However, price action analysis suggests that the LTC/BTC pair could be nearing a bottom.

4-hour chart

The 4-hour chart shows that:

  • The relative strength index (RSI) is rising from the oversold region.
  • The falling trend line is seen offering resistance at 0.0115 BTC.

Daily chart: RSI oversold

Weekly chart

The weekly chart shows that:

  • Prices are currently hovering around the 61.8 percent Fibonacci retracement level of 0.01025 BTC, which acted as a strong support mechanism in May, June and August.
  • Trading volumes have dropped significantly during the recent sell-off.
  • The upward sloping 50-day moving average is seen offering support at 0.0098 BTC.

View

  • The oversold conditions on the daily and 4-hour chart – which come at a time when prices are hovering around the critical 61.8% Fibonacci retracement support level – indicates the LTC/BTC pair could be nearing a bottom.
  • The dips below 0.01025 BTC (61.8% Fibonacci retracement) are likely to be short-lived.
  • The pair is more likely to rally to 0.012 and 0.0135 (200-day moving average) levels in the short run.

Image via Shutterstock

The leader in blockchain news, CoinDesk is an independent media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies. Interested in offering your expertise or insights to our reporting? Contact us at news@coindesk.com.

Disclaimer: This article should not be taken as, and is not intended to provide, investment advice. Please conduct your own thorough research before investing in any cryptocurrency.

Comments

comments

Filed in: Bitcoin Buzz Tags: ,

You might like:

Regional Regulators in North America Are 'Closely Watching' ICOs Regional Regulators in North America Are 'Closely Watching' ICOs
Bank of Canada Announces Phase 3 of 'Project Jasper' DLT Trial Bank of Canada Announces Phase 3 of 'Project Jasper' DLT Trial
Australian Senate Panel Throws Support Behind Crypto Exchange Bill Australian Senate Panel Throws Support Behind Crypto Exchange Bill
Upgrade Complete? Ethereum's New Software Isn't Quite Stable Yet Upgrade Complete? Ethereum's New Software Isn't Quite Stable Yet
In 'Search' of a Swell? XRP Prices Rise and Fall Amid Ripple Event In 'Search' of a Swell? XRP Prices Rise and Fall Amid Ripple Event
Algorithmic Trading Platform Integrates GDAX Exchange API Algorithmic Trading Platform Integrates GDAX Exchange API
Enterprise Ethereum Alliance Adds 48 New Members Enterprise Ethereum Alliance Adds 48 New Members
Blockchain KYC Startup Raises $1.6 Million in Seed Funding Blockchain KYC Startup Raises $1.6 Million in Seed Funding
© 7620 Virtual Mining Bitcoin News. All rights reserved. XHTML / CSS Valid.