Litecoin is currently the second most secure blockchain in the world
With hash rate spiking to new All Time Highs, Litecoin might come back BIG TIME. With regard to my earlier post I will update on the Analysis provided in the previous article:
[https://steemit.com/bitcoin/@masterofcoinz/litecoin-2013-bubble-analysis-and-2017-forecast]
Although I am solely stating my opinion on LTC up to date, I have received much positive feedback for my analysis, however my reputation fell quickly afterwards, which is indeed interesting to observe. I understand that not everyone out there agrees on a potential comeback, which is fine. In case you have wondered: I am invested in LTC. The thing however is not that I am writing a bullish article on LTC because I am long myself, the reason is that I am confident we see a reversal around this time, hence I am sharing it, hence I am positioned accordingly to my belief. I am solely stating my personal opinion and will continue to do so.
Lets start with the picture of the previous article:
Now lets recreate what happened during the last 7 days:
For the sake of more detailed analysis, heres a close-up shot:
Okay, in the previous article I stated that for the LTC/BTC ratio to reverse we need three things:
- Break of Longterm Trendline [Check]
- Stronger Bull Bars vs Bear Bars [Check]
- A Higher Low after Higher High [In Progress]
So we have achieved 2/3 objectives already, currently we are in the process to build a Higher Low. If this shortterm downtrend that we witnessed during the last two weeks is broken before it builds a Lower Low, a technical oriented traders would conclude that this is the First Higher Low of the uptrend to come, which will be confirmed above the previous Higher High around 0.00518. In the previous post I defined the green box as a potential reversal zone of this trend. As can be seen in the last picture, prices have dipped into the reversal zone, thus retested the longterm trendline from above, which is needed to form a new healthy upward trend. When it dipped into the zone, the first strong bull bar of this 14 day downtrend has appeared and reversed the move up into the zone. For Fans of Candlestick Patterns this is a Two-Bar Reversal as well as an Bull Inside Bar, which both are bull entry signals for a potential long. However what is important is not the fact that we see bull strength at all or particular candlestick patterns, but the context of where it occurs, which is at the bottom of the range AND proximity of the longterm trendline. If this signal gets confirmed (above 0.00421), it indicates that a new Higher Low Bottom has been formed. However if the signal does not get confirmed (break below the low of the daily candle around 0.00408) it is better to wait for a second bull entry signal before going long.
With Chinese New Year coming up tomorrow which includes the start of signaling period for Segwit, things get interesting fundamentally and technical. If you have LTC on your radar, I suggest to follow it closely during the next days. If bulls take control over the market at this point we have massive upwards potential. And in terms of percentage, its always wiser to buy the bottom of a range before the actual action occurs.
During my further research I have come across a great article which I would like to share with you.
Particularly one thing mentioned in the article is very interesting, which I haven't thought about previously. The majority of Chinese Exchanges trade only BTC and LTC. When BTC is stagnating, these traders will look for an opportunity to increase their number of BTC if a chance arises, in example rising prices in LTC. Many of those do not have the option to switch to altoins easily, but switching from BTC to LTC is quite easily achieved. Chinese Volume accounts for about 97% of all trades (although thats a number that included margin trading volume on OKCoin & co), so a fractional switch from BTC to LTC would result in a massive price increase in Litecoin.
Please go have a read:
http://cryptohustle.com/4-reasons-why-litecoin-could-make-a-comeback-in-2017
Take Care & Trade Responsibly