LTCUSD enjoyed a burst of volatility that was evident among most cryptocurrency pairs yesterday. This allowed price to bust through its range resistance at $57 and surged to the $60 levels.
Price has since pulled back from this sharp climb and is retesting the broken range resistance that might now hold as support. A larger correction could last until the 38.2% Fib of the move at $55.61 or until the 61.8% Fib at the middle of the range and moving averages.
Speaking of moving averages, the 100 SMA is still below the longer-term 200 SMA to signal that the path of least resistance is to the downside. However, the gap is narrowing to signal that an upward crossover might be due, indicating a return in buying momentum. In that case, LTCUSD could surge past the swing high onto the next longer-term ceiling.
However, stochastic is already indicating overbought conditions and is starting to turn lower to signal the return of sellers. RSI is on the same boat and is turning down from overbought levels. Stronger bearish pressure could spur a test of the range support at $48.
Dollar demand has been taking hits these days on weakening expectations of a December hike. While the September statement seemed hawkish, the minutes of the meeting showed more concerns about subdued inflation among policymakers.
Apart from that, anticipation for the bitcoin hard fork is also restoring investor interest in cryptocurrencies. If it’s similar to the August upgrade and rival versions fail to gain much traction, it would leave the network more stable and able to handle more transactions.
US retail sales and CPI figures are due today and downbeat results could mean a fresh set of drags on the dollar and more gains for LTCUSD. On the other hand, very strong figures could revive December hike hopes and dollar strength. As always, geopolitical risks are also slated to impact cryptocurrency price action, with political uncertainty and the looming possibility of a North Korean missile attack as potential catalysts.About Sara JennView all posts by Sara Jenn