Breaking Down The Mixed Signals, in LITECOIN! (LTC)

BITFINEX:LTCUSD   Litecoin / Dollar
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Hi friends! Welcome to this update analysis on Litecoin! Let's get right to it! Looking at the four hour chart, you can see that LTC has morphed into what appears to be a large bear flag . However, the price action inside of the flag itself, has formed an inverse head and shoulders pattern. So, there is a conflict of formations here. Additionally, we can see that the 50 EMA (in orange) is currently acting as repetitive resistance inside of the bear flag . The last candle did close above the 50, but the current candle has reversed back blow it. With that said, plenty of resistance remains overhead. Even if LTC surpasses the 50 EMA , the 61.8% retrace is just above, and the 200 EMA (in purple) is nearly converging with it. With that said, if LTC manages to rally above those levels, we may actually see a strong break to the upside, which could send us back up for a retest of the 50% retrace at the 227.60 level.

In comparison, Bitcoin also formed a bear flag pattern, but it has broken out to the upside, in a move that appears to be negating it as a bear flag . So, based on the performance of BTC , we may see a similar outcome in LTC. That, coupled with the inverse head and shoulders pattern, inside of the bear flag , suggests that an upside breakout is possible. Furthermore, we can see that the MACD is about to cross above the zero line, which is a technical buy signal.

Since there is really a conflict of signals here, and we're getting sustained resistance at the 50 EMA , we can use the 50 EMA to monitor the short term progress of LTC through the flag. You can see that two of the past few candles have pierced the 50 EMA , but they found resistance at the 61.8% retrace, which is just above. So, clearly we have a zone of resistance levels, inside of this bear flag , and that typically increases the likelihood of a breakdown. With that said, if we get above the 200 EMA (in purple) that would clear likely send LTC up to the top of the bear flag . Alternatively, if we see a breakdown of the bear flag , LTC is very likely to fall to the 78.6% retracement , at about 146, and then potentially to the 137.50 level.

I have actually been long since the green candle on the tweezer bottom was formed, on the 9th , in anticipation of a move higher. If we don't see sustained follow through here, and particularly, if we see a breakdown of the bear flag , I will quickly flip, and short LTC to my downside targets. Until then, I will remain in what has become an uncomfortable long position.

***This information is not a recommendation to buy or sell. It is to be used for educational purposes only.***

-Magic loves you-

Komen: Update: Given the action of the current candle, it is beginning to seem more likely that we will see a bear flag breakdown.

I called the LTC top a while ago. We are marching down

Thanks, great analysis... I thought we were about to break out but not looking so hot.

Here is a LTC/BTC chart if anyone is interested in seeing the correlation there.

Keep rockin' the charts Magic!
+1 Balas

broken down?
+1 Balas
@MagicPoopCannon How many candles do you consider past a certain resistance as a confirmed breakout/breakdown? Reason i ask is because we have had many instances where a formation might breakout one way and go another after the next candle.

+4 Balas
Commodore3 SmittenLTD
@SmittenLTD, A very important thing to watch on breakouts and breakdowns is volume. If there's no volume spike supporting the break, then it's probably a fake
+2 Balas
SmittenLTD Commodore3
@Commodore3, Thanks Appreciate the help, When you say spike are you talking about a considerably crazy jump?
Commodore3 SmittenLTD
@SmittenLTD, I created this little chart to illustrate my point. Hope it helps

Didn't you know that up is down and down is up? 3D is 2D and 1D this will make sense!
+1 Balas
How many time all cryptos down?? 2018 year of cryptos? I don't see
+1 Balas
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