Crypto Guide

Litecoin hits recent 2022 excessive versus Bitcoin — However will LTC value ‘halve’ earlier than the halving?

Litecoin (LTC) has emerged as one of many uncommon winners within the ongoing cryptocurrency market stoop attributable to the FTX change collapse.

LTC value outperforms BTC, ET

The 2011-born altcoin gained practically 16% month-to-date (MTD) to $62.75 on November 22, outpacing its prime rivals, bitcoin (BTC) and ether (ETH), which have been up practically 25% and 30%, respectively. . , in the identical interval.

LTC/USD every day value chart. Supply: TradingView

Moreover, the LTC/BTC value additionally hit new highs, surging 50% in November to set a brand new yearly excessive at 0.003970 BTC on November 22.

As Cointelegraph reported, Litecoin broke away from the broader crypto market downtrend earlier this month and its halving is slated for August 2023. LTC has additionally acquired one. Approval None aside from Michael Saylor for being a “digital commodity” like bitcoin.

Nonetheless, indicators of fast exhaustion are rising.

Litecoin value fractal hints at 50% correction

Litecoin’s rally versus bitcoin has left the LTC/BTC pie overvalued, in keeping with its weekly Relative Power Index (RSI) studying.

Notably, the weekly RSI for LTC/BTC, which measures the pair’s momentum and alter in value motion, climbed above 70 on 22 November. An RSI studying above 70 is taken into account overbought, which many conventional analysts see as an indication of an impending bearish reversal.

Traditionally, main value corrections have adopted Litecoin’s overbought RSI studying versus bitcoin. For instance, in April 2021, there was a powerful promote response when the LTC/BTC RSI climbed above 70, finally pushing the pair down 75% to 0.001716 BTC by June 2022.

Equally, an overbought RSI in April 2019 led to a 70% LTC/BTC value correction by December 2019.

As proven beneath, the identical RSI fractal is now along side a multi-year descending channel sample for LTC/BTC to point the potential for Litecoin to endure a 50% wipeout versus Bitcoin.

LTC/BTC weekly value chart. Supply: TradingView

Typical LTC/BTC turns into overbought after hitting the higher trendline of the channel, which leads with a correction in direction of the decrease trendline.

Consequently, if the fractal repeats, the pair is vulnerable to an extra drop to or beneath 0.001797 BTC by December 2022, which is greater than 50% draw back from the present value ranges.

Conversely, a decisive breakout above the higher trendline might see LTC/BTC check its 200-week exponential transferring common (200-week EMA; blue wave) at 0.005319 BTC, a 30% upside from present value ranges. As is the following upside goal.

LTC/USD pair “Bear flag”

Litecoin eyes an analogous value crash to the US Greenback because it portrays a bear flag sample on the weekly chart.

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Bear flags are bearish continuation patterns that seem when value consolidates increased inside a parallel, ascending channel vary after a powerful transfer decrease (referred to as a flagpole). They’re resolved when the value breaks beneath the decrease development line and falls as excessive because the flagpole.

LTC/USD weekly value chart. Supply: TradingView

LTC is buying and selling inside a bear flag vary, eyeing a break beneath the decrease trendline assist close to $55. If there’s a decisive break beneath the stated assist, the bears have a draw back goal round $32.40.

In different phrases, a 50% drop by December 2022.

This text doesn’t represent funding recommendation or suggestions. Each funding and buying and selling transfer entails threat, and readers ought to do their very own analysis when making selections.