Cryptocurrency market has not left the bad days behind yet. Although the collapse that dropped most cryptocurrencies by more than 50% has stopped, the market still looks uncertain after the initial bounce. After the initial bounce following the crash, we didn’t see a particularly impressive buying pressure. Our guests in this analysis are Litecoin and Bitcoin Cash.
As the Litecoin chart below shows, the highs are falling while the lows are rising. Therefore, a triangle is forming in most cryptocurrencies and Litecoin is currently heading towards the tip of this triangle. This means that a breakout in any direction is expected soon.
Although the moving averages, mainly the 20 SMA (grey) and the 50 SMA (yellow), are acting as support for LTC/USD today, the ascending trend line connecting the bottoms appears below. So we may see a splash soon.
1-day Litecoin (LTC) price chart
Bitcoin Cash, on the other hand, looks even more uncertain as it is caught in the middle of the two moving averages. Although the 200 SMA (purple) was crossed twice, it provided support during the crash, while the 50 SMA (yellow) and 100 SMA (green) acted as resistance at the top.
1-day Bitcoin Cash (BCH) price chart
Now BCH/USD looks like a lost puppy not sure where to go next. However, breaking the triangle in Litecoin could give a clue as to which direction the crypto market might go next. So we follow the price action in Litecoin and Bitcoin.