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Litecoin (LTC) price dropped below a key support level, which could push the asset closer to the $70 price zone.
The token was trading near $91.76 before the breakout. Following the break, Litecoin plunged as the market showed no signs of releasing the bearish pressure.
Analyst Ali Martinez noted that Litecoin’s departure from the key channel suggested a further price crash.
Traders reacted to the breach of a previously strong support zone to hold back market sentiment around Litecoin.
This breakdown has come when the overall cryptocurrency market has been highly volatile, with Bitcoin and other altcoins displaying wavering signs.
Litecoin price breakdown also reflects the broader market. This includes liquidity outflows and a weak technical structure, suggesting more downside.
Litecoin Price Breaks Key Support, Signaling a Potential Move Toward $70
Daily charts show LTC broke out of a long-held price range, and support was previously set around $97.
At this level, there have been several points in recent months where the price has been tested multiple times.
This acted as an essential support zone. However, the recent downward move has indicated a loss of steam, and a flood of sell orders has been down to an even more significant retrace.
According to the latest data from CoinMarketCap, Litecoin has recorded a loss of 4.63% in the past day and is currently changing hands at $88.15.
This price movement was accompanied by a 9.80% loss in trading volumes. The drop brought the 24-hour volumes to $578.35 Million.
This has further affected the market capitalization, which has lowered to $6.66 Billion as selling pressure heightens.
It isn’t unusual for Litecoin to fall lower before facing strong buying support. However, price trends indicate that there could be a significant downside.
LTC Price Action Shows Recovery After a Sharp Drop in Value
Litecoin touched a local high at around $129 and has since been moving downward, losing essential support levels.
As such, this latest breakdown of this bearish movement makes this probability much greater. LTC initially bounced from near $85, but overall, the market structure remains weak.
Litecoin’s attempts to recover have hit strong resistance, notably ranging from $90 to $92.
However, if Litecoin price cannot liberate this territory, the next big area of support will be around $70.
Looking at the 4-hour charts, we see a rising wedge pattern. The wedge pattern commonly predicts a reversal after a period of uptrend consolidation.
The last breakdown of the wedge embodies a bearish bias.
Volumes have stayed at a low level, which means buyers are not coming in aggressively.
The lack of demand for the stock makes it more likely that the downside movement could continue if the key support levels were broken.
The Volume Oscillator (-0.35%) is down, suggesting a persistent weak volume. This implies there is no surge in buying momentum.
A Litecoin price breakout is usually deemed valid when it is accompanied by a drop and increasing volume.
