Charting the Comeback: Litecoin Price Reclaims Support, Hinting at the Potential Emergence of a Bullish Trend

The Litecoin price recently dipped below a critical support level on November 21 but has successfully reclaimed it since. The question now arises: will Litecoin establish a bullish structure and experience an upward surge, or is there potential for another breakdown? Let’s delve into the analysis.

Charting the Comeback: Litecoin Price Reclaims Support, Hinting at the Potential Emergence of a Bullish Trend

Examining the weekly timeframe, technical analysis reveals that the Litecoin price had been following a descending resistance trend line since April 2021. The descent led to a low point of $40 in June 2022. Subsequently, there was an upward movement in Litecoin, resulting in a breakout from the trend line in June 2023. However, this increase was short-lived (indicated by the red circle), and LTC fell below the trend line once again.

Nevertheless, another positive movement in LTC’s price commenced in October, leading to a breakout from the trend line two weeks ago. Last week, the LTC price validated the trend line as a supportive level (indicated by the green icon) and initiated an upward trajectory.

Market analysts often use the Relative Strength Index (RSI) as a momentum indicator to identify overbought or oversold conditions, aiding in decisions to buy or sell an asset. Readings above 50 in an upward trend suggest bullish dominance, while readings below 50 indicate the opposite. The current RSI stands at 50, reflecting an undetermined trend at the moment.