After days of trading sideways and showing very little appetite for trending upwards, Litecoin has finally broken below a crucial support zone. The coin is now facing a major downside and could crash over the coming days. Here are the main takeaway points:
LTC has broken below the crucial $64.34 support.
The coin is exposed to a 30% downswing as a result of this.
However, so far LTC is yet to decisively drop and could still regain this support this week.
Data Source: TradingView
At the moment, it doesn’t seem like LTC will crash. If anything, the bulls are trying to regain the $64 mark. The coin will need to gain around 5% over the next 24 hours to reclaim the support. However, although this may look like a simple thing, LTC has actually remained suppressed below that price for most parts of the day.
We do not think there is enough buying activity in the market to push LTC above $64. As a result, we expect the coin to remain closer to the price at the end of the day but ultimately, LTC will not close above this price.
This will trigger a decisive sell-off over the coming days that could see LTC drop by nearly 30%. The altcoin will eventually settle at around $51 in this bearish cycle before it tries to find its next run. But if more weakness follows and LTC loses $51, it could crash to $40.
The downside risk for LTC is significant right now. The best you could do is to wait a few days to see if bulls can regain $64 and keep the price action above it.
But if you are looking to buy LTC for the long term, there will be an opportunity to get it cheap when it tanks to $51 or thereabout.