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Litecoin Hits New 2022 High Against Bitcoin – But Will LTC Price Halve Before the Halving?

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litecoin (LTC) popped up as A rare winner In the ongoing collapse of the cryptocurrency market led FTX stock market crash.

LTC price is outperforming BTC and ET

The altcoin born in 2011 is up nearly 16% month-to-date (MTD) to reach $62.75 on November 22, outperforming its major competitor, Bitcoin (MTD).BTC) and ether (ETH), which are about 25% and 30%, respectively, in the same period.

LTC/USD daily price chart. Source: TradingView

Moreover, the LTC/BTC price also rose to new heights, surging by 50% in November to set a new yearly high of 0.003970 BTC on November 22.

As Cointelegraph mentionedLitecoin has moved away from the broader bearish trend of the cryptocurrency market earlier this month with the halving scheduled for August 2023. LTC has also received authentication Who else is Michael Saylor for being a “digital good” akin to Bitcoin.

However, signs of bullish exhaustion are showing.

Litecoin Price Fraction Points to a 50% Correction

Litecoin’s rally against Bitcoin sent the value of LTC/BTC pai higher, according to its weekly Relative Strength Index (RSI) reading.

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Notably, the Weekly Relative Strength Index for LTC/BTC, which measures the pair’s volatility and price movements, rose above 70 on November 22. An RSI reading above 70 is considered overbought, which many traditional analysts see as a sign of an imminent bearish reversal.

Historically, overbought RSI readings in Litecoin vs Bitcoin have followed major price corrections. For example, in April 2021, the LTC/BTC RSI rally above 70 was met with a strong selling reaction, eventually pushing the pair down 75% to 0.001716 BTC by June 2022.

Similarly, the overbought RSI in April 2019 led to a 70% correction in the LTC/BTC price by December 2019.

The same RSI fractal now suggests that Litecoin could undergo a 50% wipeout against Bitcoin if it pairs with the multi-year bearish channel pattern for LTC/BTC, as shown below.

LTC/BTC weekly price chart. Source: TradingView

The typical LTC/BTC turns overbought after hitting the upper trend line of the channel, which is followed by a correction towards the lower trend line.

As a result, the pair risks dropping to or below 0.001797 BTC by December 2022 if the fractal repeats, down more than 50% from current price levels.

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Conversely, a decisive break above the upper trend line could lead LTC/BTC to test its 200-week exponential moving average (200-week exponential moving average; blue wave) at 0.005319 BTC, up 30% from the current price levels, as the next upside target.

LTC/USD “Bear Flag”

Litecoin is eyeing a similar price collapse against the US dollar as it is drawing a bear flag pattern on the weekly charts.

Related: Cathie Wood’s ARK Invest Adds More Bitcoin Exposure as GBTC and Coinbase Stock Hit New Lows

Bear flags are bearish continuation patterns that appear when the price consolidates higher within the range of a parallel ascending channel after a strong bearish move (called a flagpole). It is resolved after the price broke below the lower trend line and fell as far as the flagpole height.

LTC/USD weekly price chart. Source: TradingView

LTC is trading within a bear pennant range, and is looking for a breakdown below the lower trend line support around $55. The target on the downside of the bear flag is around $32.40 if it breaks decisively below the mentioned support.

In other words, a 50% drop by December 2022.

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This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should do their own research when making a decision.