Why is Litecoin Pumping? Technical Analysis

Litecoin has been rising for the last 2 weeks. It has risen more than 18% in the past 1 week and about 14% in the last 24 hours.

What is Litecoin?

Litecoin is a cryptocurrency created by making a hard fork in Bitcoin’s code. It was much faster than Bitcoin’s block time of 10 minutes at just 2.5 minutes per block. It was created by MIT and launched on October 13, 2022. Since its inception, Litecoin has been one of the top 20 most widely held assets.

Technical Analysis

On daily charts, Litecoin has some very interesting data. The cryptocurrency has been strong regarding RSI, Volume, and Moving Averages.

Relative Strength Index

RSI shows that the momentum of buying is increasing. The current RSI on the chart is 64 in a bear market. Any RSI reading above 60 in a bear market is a case of high bullishness. Further, the RSI has decisively crossed 60 without retracements, which shows strong momentum that might continue in the near 1-2 days.

Volume

Trading volume has been consistent since the last week. Earlier volumes were about 20% of the current volume figures. The increased volume shows that investors and traders have been buying Litecoin to invest in the long term. This increased volume also assures that any retracement is unlikely.

Moving Averages

The cryptocurrency is above its 200-day moving average of $58.10. It has also crossed 5-day, 10-day, 20-day, 50-day, and 100-day moving averages. Crossing the 200-day moving average and sustained trading is considered a very strong signal.

Further, the Moving Average Convergence and Divergence also show a positive crossover as MACD Line(Blue) and the Trend Line(Orange) diverge. This divergence shows that markets are buying Litecoin with great momentum.

Conclusion

The movement of Litecoin crossing all moving averages shows that there is sufficient buying interest. RSI shows that there is a possibility of sustained buying. However, cryptocurrency investments are volatile. This article is for educational purposes and should not be taken as trading advice.