Litecoin Price Forms Bullish Flag and Break and Retest Patterns
Litecoin (LTC) has erased some of the spectacular gains it made during the weekend and on Monday. The Litecoin price has crashed to a low of $245, which is substantially below the weekend high of more than $300. It is not alone since other cryptocurrencies like Bitcoin and Ripple have also crashed. And the total market cap of cryptocurrencies has dropped to about $2.8 trillion.
Why has LTC crashed? Litecoin is a cryptocurrency that is relatively faster and more efficient than Bitcoin. The currency achieves this speed and lower cost because of how each block is confirmed. For Bitcoin, blocks must wait for about 10 minutes while with Litecoin, the wait time is often cheaper.
These features have made Litecoin a popular alternative to Bitcoin. As a result, many crypto enthusiasts see LTC as a means of exchange and Bitcoin as a store of value just like gold.
The Litecoin jumped sharply recently after the Litecoin Foundation launched a new Visa card in collaboration with Unbanked. The card means that one can load it with Litecoins and use it in all places where Visa is accepted.
People can also use the card to HODL their coins. While this is a good way of taking Litecoin mainstream, there are already alternatives to the card. For example, Nexo and Crypto.com offers similar Visa cards but those that can be topped up with other cryptocurrencies.
The Litecoin price is falling today for two main reasons. First, historically, cryptocurrencies tend to retreat after hitting a key resistance level. In this case, it moved to the key resistance at $300. Second, the decline is part of the overall cryptocurrency sell-off.
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Litecoin price prediction
The four-hour chart shows that the LTC price has been under pressure in the past few hours. Precisely, it has dropped by more than 55 points from its monthly high. At the same time, it has formed a bullish flag pattern that is shown in green. It has also moved slightly below the 50-day volume-weighted moving average. Most importantly, the coin seems to be forming a break and retest pattern since it is approaching the key support at $236.
Therefore, since the bullish flag pattern is usually a positive sign, there is a likelihood that the price will bounce back soon. If this happens, it will likely retest the upper side of the flag at around $280. On the flip side, a move below the support at $236 will invalidate the bullish view.
