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The cryptocurrency market has seen a number of mini-crashs in September. While some alts have weathered multiple waves of selling pressure, others have struggled to regain lost ground. Litecoin fell somewhere in the middle. The alt cut its losses at a support line of $145, recovered 14 percent, but remained below bullish control levels.
LTC needed to close above certain key levels in order to assert its dominance. However, the market shifted in favour of sellers, who were ready to apply more pressure. LTC was trading at $151.4 at the time of writing, up 4% in the previous 24 hours.
LTC Daily Chart
Since the 19 May crash, LTC’s support around $145 has been critical. This defensive zone thwarted multiple break-in attempts in early June and transitioned to a formidable resistance in July. The region was thrust back into the spotlight after LTC fell by 24% in the previous week. This was unquestionably a good sign, as a strong support level quelled yet another round of selling pressure.
However, in order to attract more buyers to the market, LTC needed to recoup some significant losses. The 50 and 20 SMA confluence would be targeted as the first immediate barrier at $165. The 200-SMA (green) around $190 was the final level of resistance. A successful close above the aforementioned levels would put buyers back in control, allowing for a push above $233.
This structure, however, would be lost if LTC closes below $145 on high volume. If sellers outnumber buyers, the price could fall as low as $103.7. Furthermore, the indicators supported an unfavourable forecast after falling below critical levels.
For the time being, LTC indicators are more favourable to sellers than to buyers. The MACD and Awesome Oscillator both fell below their half-lines, opening the market up to short-selling. Furthermore, the candles had fallen below their EMA Ribbons, indicating the start of a bearish trend. If buyers do not adapt quickly, LTC is vulnerable to another sell-off.
Given the indicators, LTC’s support level of $145 would be under severe pressure once more. A breach of this defence would allow access to July lows of $134.8, $118.5, and even $103.7. LTC would need to fall below $165 to turn bullish. This would pave the way to $233.