- Litecoin price has been stuck in consolidation but appears to take a bearish direction in the near term.
- Adoption by financial institutions continues to make progress.
- A break below the $161 support base will make things worse for LTC.
Litecoin price has been stuck in indecision since the Tuesday September 07 cryptocurrency market flash crash. LTC has been hovering between $169 and $190. Litecoin has made several attempts to undo the losses buy has not been able to breakout above the 200-day Simple Moving Average (SMA). LTC appears to headed for a breakout downwards but this move is noy very clear.
Positive Fundamentals To Bolster LTC Buying Appetite
Continued positive industry news is likely to help Litecoin traders to make a decisive move either to take LTC upwards or downwards.
Latest developments and new projects in the cryptocurrency industry seem to be on a roller-coaster in the ever-growing cryptocurrency field. This is evidenced by developments from Morgan Stanley, one of the largest financial institutions globally which is seeking to launch a cryptocurrency research department. The division is to be led by the banks lead currency strategist, Sheena Shah.
This is an indication that traditional financial institutions are continuously becoming cognizant of the increasing significance of cryptocurrencies in the global markets.
Apart from that, the online payments giant, PayPal, has completed the first international expansion of its offering of crypto services outside the United States. PayPal Crypto is now available to customers in the United Kingdom allowing them to buy, hold and sell Litecoin (LTC) and other major cryptos such as Bitcoin (BTC), Ethereum (ETH), and Bitcoin Cash (BCH).
Confirming the rollout, official account PayPal U.K. official account tweeted:
“We are delighted to share that all eligible customers in the UK can now buy, hold and sell cryptocurrencies bitcoin, Ethereum, bitcoin cash & Litecoin from their PayPal account.”
Note that PayPal enters the local cryptocurrency market at a time when some UK financial institutions and banks are restricting payments to crypto exchanges. In August, HSBC, the largest bank in UK suspended credit card payments to Binance. HSBC said that it was concerned about possible risks to its customers.
Other banks such as NatWest and Barclays had previously stopped transactions to Binance.
Gregory Klumov, CEO Stasis, a tokenization firm, describes PayPal’s cryptocurrency rollout in the UK as a “breath of fresh air.” He adds that the ““… the country is in the world’s top 10 economies, such a milestone will clearly drive the continued adoption of digital assets in Europe and beyond”
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Litecoin Price In A Break Or Make Territory
Litecoin price is currently trading above the $164 support base on the daily chart. The chart also shows that LTC has been consolidating between $169 and $190 between September 08 and September 19.
At the time of writing, Litecoin is trading at $168.05 on most crypto exchanges and appears to be battling immediate resistance provided by the 50-day SMA at the $175.97 mark. A clear breakout above this level will bolster bulls to kick-start a bullish momentum. A decisive breakout will be seen if LTC closes above the consolidation territory at $190.71 that is likely to push the asset above the 200-day SMA at $193.98 to recover the losses caused by the September 07 flash crash
In a highly bullish scenario, the Litecoin could extend this rally to retest the next psychological level at $240.
LTC/USD Daily Chart
While the optimistic scenario looks likely, a potential bearish breakout will ensue if LTC closes below the immediate support a $164. If this happens, Litecoin price will break below consolidation territory at $161.23 towards the 100-day SMA at $156.63. a further drop below this place would see the LTC/USD price fall towards the $140 psychological level.
Note that the parabolic SAR has just flipped from positive to negative adding credence to this bearish outlook. This is also accentuated by the entry of the MACD into the negative region. Moreover, the Relative Strength Index (RSI) is moving downwards, an indication that the bears are stronger than bulls at the moment.
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Furthermore, the In/Out of the Money Around Price (IOMAP) Model by IntoTheBlock shows that Litecoin faces stiff resistance upwards. For example, the major resistance around the $180 mark is within the $177 and $182 investor cluster where around 2.8 million LTC were previously bought by 298,240 addresses. These investors might want to break-even curtailing any further movement of the Litecoin price upwards.
Litecoin IOMAP Model
The same IOMAP chart shows that Litecoin’s support downwards is not robust enough to absorb immense selling pressure that might ensure in the near term. For instance, the immediate support is within the $162 and $167 price range where only 67,850 addresses previously bought approximately 1.28 million LTC.
Therefore, the short-term price prediction for Litecoin price is bearish.
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Nancy Lubale
