Litecoin has been trading in a range for quite some time as it bounced off support at $30.682 and resistance at $33.762. Price is currently testing the top of the range once more and might be ready for an upside break.
The moving averages are oscillating to reflect sideways price action but the 100 SMA is currently above the longer-term 200 SMA to indicate that the path of least resistance is to the upside. In other words, resistance is more likely to break than to hold.
If a breakout happens, Litecoin could be in for a climb that’s around the same height as the rectangle pattern. However, stochastic is already in the overbought zone and is starting to turn lower to signal that a return in selling pressure is due. In that case, another dip to the bottom of the range may be in order.
Volume is looking subdued at the moment, but a strong breakout could inspire a pickup in buying interest. If so, there’s a better chance of a rally being sustained. Otherwise, low volumes could signal that an upside break might be a fake out.
Coingate, a cryptocurrency merchant payment provider with over 4500 merchants, has already implemented the Lightning Network for Litecoin payments. According to the company, Litecoin accounts for 10% of Coingate’s monthly volume. Lightning Network is a second-layer scaling solution initially created for Bitcoin but recently adapted and launched for Litecoin, promising better cost savings.
Meanwhile, earlier on, Coinbase has rolled out institutional support for Litecoin, which could prep this coin better for inflows from banks and funds, along with Bitcoin and Ethereum. But as with most digital assets, traders still seem to be holding out for actual evidence that institutions are already investing more funds in the space rather than riding out on expectations.
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