Litecoin’s Downtrend Resumes: Here’s What You Need to Know
• Litecoin has been in a bearish trend since mid-July, and the downtrend has not abated in August.
• A bounce toward $70 was possible to fill a fair value gap (FVG) on the H4 chart that extends from $65.97 to $72.79.
• The Open Interest chart showed sidelined speculators as funding rates remained negative.
Overview of Litecoin
Litecoin [LTC] noted a firm bearish market structure and momentum on its 4-hour chart after higher timeframe support zones were convincingly breached, paving the way for further losses. The asset experienced its halving on 2 August and the mining difficulty increased as the mining reward decreased.
A bounce toward $70 was possible to fill a fair value gap (FVG) on the H4 chart that extends from $65.97 to $72.79 before prices are forced lower once again.
The bearish conviction has not left the Litecoin market yet with short-term data from Coinalyze showing that after the steep fall, the funding rate flipped negatively and has stayed that way since.
The resistance zones at $84 and $70 were demarcated in red and represent a former bullish order block on the 1-day chart which was established in mid-March when prices rallied to reach around $100 before being breached by sellers lately with strong conviction.
It is likely that LTC will continue downward towards the 23.6% extension level southward at around $60.23 while there may be some minor rebounds due to FVG before this occurs