Analysis provided by Ashton Fraser, learn more about his Forex Reversals trading strategies.
Litecoin has been meandering between two Fibonacci levels for the past 24 hours, and it doesn’t seem as though that’s going to change any time soon.
I mentioned in yesterday’s analysis for LTC/USD that price was very likely to hover between certain levels, and that’s remained the case for today as well.
I’ve done the Fibonacci study on the H4 chart from the low of last month at 10.700, until the high of this month at 18.76, as can be seen below:
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If we take a look at the LTC/USD H1 chart below (click to expand), it’s clear that the intra-day technicals are in conflict with each other, especially the Stochastic Oscillator, (circled in white), which is very messy:
I.e. the Stochastics have literally crossed over each other three times in a space of barely a few candles. Not pretty reading. Reading the Stochastics can be tricky, but once you’re used to it, it’s an invaluable tool in determining how smooth or choppy the immediate future may turn out to be, in conjunction with valid corroboration from other technicals of course. Having said that, even on it’s own it’s still a powerful tool to get an idea of the market, without actually basing your entry purely on it alone. The difference here obviously is, we’re not encouraging any entry here, because we’re using the Stochastics right now as a negating factor, meaning, any entry right now for a short term gain wouldn’t be wise, unless one intends to hold Litecoin for a while. Even then, looking at higher timeframes, I can’t see much of a reason to enter right now. I’m just seeing things as pretty ugly quite frankly, with conflicting technicals on almost every timeframe.
Also of note, when zooming out on the hourly, is the downwards trendline, which could add another dimension to multitude of messy dimensions already established on LTC: