If Bitcoin would replace gold, then Litecoin would replace Silver, is what people said. Litecoin is a cryptocurrency with a total supply of 84 million LTC. It’s supposedly more targeted to become a digital cash systems rather than Bitcoin’s store of value function. Forked off from Bitcoin, it uses a different mining algorithm and has a block time of around 2,5 minutes, Bitcoin’s statistics times or divided by 4. They did a couple big public relations work this year by sponsoring events like the UFC and a Hollywood Film Festival.

I’m not a big fan of Litecoin because it doesn’t add any much “value”. Besides, the bigger total supply and faster confirmation times to make the coin more spendable, there isn’t much intrinsic that Litecoin offers. Some say that it functions as Bitcoin’s “testnet” for new features or code changes, but that would do the rigorous testing environment of Bitcoin’s developer’s shame. They on their own are a valuable testing ground. Their main selling point of being more spendable than Bitcoin will not hold out for long as the crypto-environment continues to grow and develop (eg. LN). Litecoin is a fork and a competitor of Bitcoin, unless they innovate something else that Bitcoin can not offer, my bet is on Bitcoin for winning the marathon. Charlie Lee saves the day by recently announcing that Litecoin and co. are planning on adding Confidential Transactions to Litecoin, something Bitcoin does not have. By utilizing the protocol MimbleWimble, which relies on Coinjoin, more privacy can be added to Litecoin. This news and is also reflected on the price action of LTC/BTC.

Looking at the long term view of LTC/BTC, I think that we are looking for a touch into the  0.03 – 0.035 sats territory during 2019, the green area.

I found 2 trendlines in which Litecoin has been ranging. LTC finished a bullish gargle pattern and is starting it’s uptrend to test previous highs. My bet would be the price following either the yellow, green arrow or split. While the price has been making a higher low, the MACD has been making a lower low, indicating a hidden bullish divergence. The MACD also looks like to rise into the positive. The RSI has also broken and retested a downwards resistance. It’s headed up for the overbought are which is a bullish indication. The first major resistance would be the somewhere in the area of 0.017 – 0.02 sats. Combined with the 50% trend based extension Fibonacci. Target zone is also just above the 100% retrace on the Fibonacci. There is bullish confluence along the indicators and price action.

Zooming in slightly, I see a finished inverse head-and-shoulder pattern on the 1D LTC/BTC chart. The target for that is the % from the low of the head to the neckline. I copied the red striped arrow and pasted it next to the right-shoulder. According to the pattern, the target should be around the 0.015 stats or the 38% retracement level. I would not be surprised to see the target extend until the red major resistance zone of 0.17 – 0.02 just to tap it with a wick. We probably will also see a touch back into the orange area where the inverse head-and-shoulder pattern finished to confirm support and tap into the liquidity. At this point it’s hard to say before or after head-and-shoulder target.

This is a possible scenario in my head that takes the most advantage of liquidity, support/resistances, patterns and most importantly, fucking everyone over as much as possible (margin calls, taking stop-losses and etc.). That’s how you earn money as a market maker.

LEAVE A REPLY

Please enter your comment!
Please enter your name here