LTC/USD Technical Analysis – 18th March 2014

Analysis provided by Ashton Fraser, learn more about his trading strategies with the Forex Reversal Indicator. Litecoin has been rising

Analysis provided by Ashton Fraser, learn more about his trading strategies with the Forex Reversal Indicator.

Litecoin has been rising this morning, hitting a certain level, virtually to the very pip, for at least three excellent reasons, which I’ll explain below.

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Let’s examine our LTC/USD chart. Specifically the H4 timeframe. Click below to expand:

ltcusdh4_18_03_2014_18.00

Before we even apply any Fibonacci or other technical indicators, we can see one of the causes behind price stalling where it did. 18.00 is a whole number, hence a significant psychological support/resistance point. So that’s the first reason.

Reason number two. I’ve performed the Fibonacci study from March’s high on the 4th at 18.76, until last week’s low at 15.11 :

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ltcusdh4_18_03_2014_78.6

And immediately, we have some further revelation, that just below 18.00, (17.97 to be precise) is also a Fibonacci retracement level, in this case the 78.6% level.

Third reason, using a Fibonacci extension on a shorter swing high to swing low (17.37 to 16.38), to ascertain potential take profit zones, gives us yet another important Fibonacci level – this time the 161.8% extension. Once again – price stopped at exactly at this point, as can be seen below:

ltcusdh4_18_03_2014_161.8

So there we have it. Three solid reasons why price stopped where it did, once again proving that even when trading digital currencies, there’s a method behind the madness, time after time.

Learn more at http://www.forexreversal.com

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