Hi friends! Welcome to this update analysis on Litecoin! Let's get it. Looking at the four hour chart, you can see that LTC has been rejected at the high of the bull flag , and has fallen below the 50 EMA (in orange.) This is a bit concerning, but you can see that the 50 has been violated a lot in the recent trading action, so it isn't very surprising. The 200 EMA (in purple) is the critical support level that needs to be held. If we fall from here, and confirm below the 200, that would be a negative development. However, we can see that the 200 EMA is converging with the 61.8% retrace at the moment, so it is strengthening that level as support.
If you'll notice, we still remain inside of a technical bull flag . I have extended the flag outward, but you can see that the flag formation has not yet been breached, so it's technically still a flag formation . The pink dotted trendline , is a secondary low level of support, and LTC is testing it heavily right now. If this level is breached, look for the 200 EMA to act as support. With that said, we remain inside of a bull flag , inside of the right shoulder of a potential inverse head and shoulders pattern. So, the overall vision is still intact.
I want to draw your attention to the 50% retrace (in red.) You can see that it has been an extremely important level of support and resistance . Most recently, it has been purely resistive, as LTC has slammed into it on multiple occasions, without sustaining a breakout. If we have a confirmed breakout above that level, it will be HUGELY bullish . For now though, let's monitor this bull flag , and the development of the right shoulder. Keep in mind that the bull flag appears to be trying to break down, but it's still a bull flag until that actually happens. Stay on your toes, and keep a close eye on the 200 EMA and the 50% retrace.
