We are having fun swing trading Litecoin (LTC/BTC). Our January 4, 2019 trade recommendation hit its target on January 6 when the market rallied to as high as 0.010121. Those who took on this trade grew their investments by close to 20% in two days.
Now, we expected Litecoin to correct after hitting our target as it looked overextended. It was extremely oversold on the 12-hour chart. Also, the candles had wicks on top of their bodies. This was a sign that sellers were taking advantage of the breakout rally.
Sure enough, Litecoin pulled back. Nevertheless, this gives us the opportunity to buy the dip.
Technical analysis shows that LTC/BTC is headed to support of 0.0085. This retracement is actually bullish as it gives the market a chance to retest the neckline of the inverse head and shoulders pattern. A successful retest enables Litecoin to flip 0.0085 resistance into support.
In addition, we can see the 50 MA on the 12-hour chart crawling around 0.0085. Also, the 100 MA is about to cross above the 200 MA. The golden cross on the 12H would give us the perfect MA alignment where the 50 MA is on top of the 100 MA and the 100 MA is above the 200 MA. This setup is a very good indication that the market’s uptrend is healthy.
The strategy is to buy on dips as close to 0.0085 as possible. As long as Litecoin stays above this level, it will likely gather the momentum to rally to our target of 0.01.
The process may take less than a month.
12-Hour Chart of Litecoin/Bitcoin on Binance
As of this writing, the Litecoin/Bitcoin pair is trading at 0.008782 on Binance.