Analysis provided by Ashton Fraser, learn more about his trading strategies with the forex reversal indicator.
Since the 22nd of March, Litecoin vs Bitcoin has been in a slow recovery mode, slowly but surely making headway, although it will need to break a certain resistance level in order to continue the trend.
Let’s take a closer look at the LTC/BTC chart on the four hour timeframe (click below to expand):
I’ve performed the Fibonacci study from the high of the crash on the 19th at 0.034, until the low of last week on the 20th at 0.027.
As mentioned, from the 22nd, there’s been a gradual northern trajectory. Check out the Awesome Oscillator, just look at how it’s been green for almost thirty candles now, virtually uninterrupted. This rarely happens, and the fact that it’s happening now, tells us that momentum is strong. And by looking at the Bollinger bands, we can see how the squeeze has been nullified, as the expansion comes into fruition. We also have the Stochastics still heading upwards.
So currently, everything tells is price is going to be heading north for some time yet, right?
Wrong. Everything, apart from:
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a) Fibonacci. We can see right now, that price is exactly at the 23.6% Fib retracement level, at 0.0285. This could provide some resistance to any further uptrend.
b) Accelerator Oscillator – it’s just turned red.
c) Candlesticks. Look at the price action of the past three candlesticks. They all have relatively long upper wicks.
d) Bollinger bands. Price is dangerously close to the upper band.
e) Stochastics. Despite pointing north, they’re now in overbought territory.
Ok, so almost everything, heh.
Thus, with all factors considered, I expect price to struggle to break 23.6% right now, although we could see a break by tomorrow.
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