LTC and EOS: Corrective recovery expected before further downside movement

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LTC/USD

The price of Litecoin has been decreasing from Monday with strong momentum. The cryptocurrency has depreciated in value by 14.61% from Monday’s high at $115.52 to the low at the yesterdays open at $98.64 which is the weekly low so far. The price is currently being traded at around $104 as it found some temporary support.

On the hourly chart, you can see that the price of Litecoin interacted with the still unconfirmed ascending trendline after which it started forming a cluster above the level which is now starting to look like an ascending triangle with the price stuck below $105.455 resistance level from the upside but higher lows have been made. This indicates that the buyers are trying to make a recovery buy the sellers are putting strong pressure on the same horizontal level.

If the buyers manage to catch up some traction and regain control temporarily we are going to see a breakout to the upside from the currently seen ascending triangle but I don’t believe that the upward movement would continue past the next significant resistance point which would be at around $109.35 which is the significant horizontal level above which it is considered to be the sellers territory. The next significant resistance point would be at the formed expanding channel to the downside but if the price takes some time to get to the upside it could bring this level lower since it is a descending one, closer to the previously mentioned significant horizontal one and would eventually intersect it.

Last Thursday we have seen the end of the five-wave impulse to the upside which is the sub-wave of the higher degree 5th wave of the Minute count. If this impulse wave ended it means that even a higher degree count has completed with the price starting a downside movement either as a correctional one or a higher degree downtrend. The first significant support zone I would expect to see the price of Litecoin after a corrective upside movement would be at around $83 area, but if we are seeing the starting downtrend this support point would only be the first one with the price eventually going below it as well.

EOS/USD

From Saturday the price of EOS has been in a downtrend and decreased by 29.7% coming from $8.6 to $6 at its lowest point of the week on yesterday’s open. The price has started recovering since but has only come up to $6.52 before showing signs of struggle as the sellers have pushed the price back to $6.27 level again with the price currently being traded there.

Looking at the hourly chart, you can see that the price is looking for support around the 0.236 Fibonacci level as it came below it on yesterday’s open but quickly pulled back up and has been retesting it since. The price prior to the downfall made a higher high coming to $8.66 at its highest point which was the ending of the 5th wave from every count which means that we are seeing the development of the downside move which follows the completion of the impulsive move.

Now that the price has decreased by over 29% in one go, we are likely to see a recovery attempt. The price fell below $6.8 significant horizontal support so interaction with it from the downside for a retest of resistance looks likely but the price could continue moving above it if the buyers catch enough momentum and if the price continues moving above it the next significant level would be around half range of the previous decrease which would be at $7.33.

After this recovery ends, more downside would be expected for the price of EOS if the downtrend has started with the next significant support zone being at around $4.6

 

Nikola Lazić

Expertise: Cryptocurrencies, Technical analysis, Elliot waves, Fibonacci Nikola has a bachelor degree in Sociology, which gives him the edge in the financial market, knowing a lot about herd mentality. That is why he uses Elliot wave principles mostly, in combination with Fibonacci levels. He started learning more about financial markets back in 2015 and is now a full-time trader. As an anarcho-capitalist, he fully supports the vision of decentralized future offered by cryptocurrencies, that's why his attention and interest are mostly focused on them. His analysis has been praised by some of the most influential people from the cryptocurrency scene, like Jeff Berwick, the founder of The Dollar Vigilante Newsletter, Vit Jedlicka, the president of Liberland, and other trader colleagues.

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