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LTC Reverses From Highs
Following a short-lived breakout to fresh YTD highs, Litecoin has come under heavy selling pressure over recent weeks. The failure at the 102.61 level has seen the market reversing sharply, trading down to lows or mid 75 before demand kicked in to stall the move. With US CPI ahead today, there is plenty of two-way risk in the market. An upside beat in today’s US CPI reading will see crypto come under fresh selling pressure while a downside surprise should help lift the market near-term.
Liquidity Fears
However, the crypto space is dealing with some non-USD issues currently. Temporary withdrawal freezes at Binance, the world’s largest crypto exchange, on Sunday led to heavy selling pressure at the market open as traders feared liquidity issues at Binance. While the exchange explained away the issue, coming hot on the heels of recent crypto exchange collapses, traders are understandably cautious. Bittrex filed for bankruptcy on May 8th, the second largest crypto broker to fail after FTX.
Near-Term Risks
Against this backdrop, crypto sentiment has weakened and looks likely to remain weak going forward particularly if market expectations veer back in favour of projecting a further rate hike from the Fed in June. Similarly, any further bankruptcies or negative news flow from crypto-sector companies will be a key headwind to watch out for.
Technical Views
LTCUSD
There is currently an active sell limit issued in the Signal Centre for LTCUSD at bespoke resistance at the 84.23 level. This is also a strong structural level for the market, marking the ledge of swing lows from late April which were broken on the recent sell off. Traders can look for a retest of this area to initiate fresh short positions targeting 77.23 initially.
Signal Centre is a proprietary trading-signal suite offered to all Tickmill traders. Signal Centre combines human and AI driven analysis to offer traders actionable entry and exit points that they can use for their trading strategies. Signals are offered across a range of asset classes including Forex, Stocks, Commodities and Crypto.
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With 10 years of experience as a private trader and professional market analyst under his belt, James has carved out an impressive industry reputation. Able to both dissect and explain the key fundamental developments in the market, he communicates their importance and relevance in a succinct and straight forward manner.