The TD Sequential indicator signaled a buy signal on the 2-hour and 4-hour charts, pointing to a potential recovery above $ 140 for LTC.
Litecoin (LTC) is trading around $ 128 against the US Dollar after exiting the horizontal support of the triangle pattern descending from $ 121. As such, LTC / USD was able to hold above the key support around $ 127, sparking optimism among the bulls.
As shown below, the Litecoin price increase follows the appearance of a buy signal suggested by the TD Sequential indicator on the 2-hour chart.
The indicator presented nine red candlesticks showing the potential for a buying pressure flow as sellers retreated. The buy signal was pretty accurate for LTC, and it sees the bulls pushing LTC / USD from less than $ 130 to $ 147.
The uptrend reversed when Bitcoin’s slump to $ 29,000 reduced crypto sentiment, resulting in a wider sale in major altcoins. Before the latest bailout efforts, the LTC price fell to $ 121.
Buyers are facing an upward momentum taking back control above $ 140, but the short-term outlook shows that moving above $ 130 will open a way for the bulls to easily test the 50-day simple moving average ($ 134).
From here, the LTC bulls are likely to quickly rise to $ 140 or see several days of horizontal trade as momentum increases for a break above the triangle pattern.
If we look at the RSI, it’s hovering below the 50 level, which means bears won’t be relieved that easily. However, the indicator is presented with a hidden bullish divergence to indicate the potential of the outlook to turn positive on the increased bullish volume.
The 4-hour chart also has a TD Sequential indicator flashing a buy signal, and the bulls want to rise towards the 50-SMA ($ 137).
The 4-hour RSI also has a similar appearance to the 2-hour chart. It is therefore likely that the bulls will struggle to break the resistance wall around $ 135-140. If they maintain the increasing upward momentum, retesting recent highs of $ 185 will be possible in the short term.
If the bulls cannot sustain the upward movement, downward pressure may push prices below the horizontal support of the descending triangle pattern. This scenario can see LTC / USD drop towards the psychological $ 100 level, exceeding $ 120.