/ Trading / LTCUSD Technical Analysis for 12/22/2017 – Short-Term Downtrend Ensues
- Sara Jenn
- Published on December 22, 2017 at 4:47 GMT
LTCUSD is trending lower on its 1-hour time frame and moving inside a descending channel. Price is just bouncing off support and might be due for a test of resistance soon.
Stochastic is pulling up from the oversold area to signal that sellers are taking a break and allowing buyers to take over. Similarly, RSI is pointing up and LTCUSD might follow suit if it keeps moving higher.
However, the 100 SMA is still below the longer-term 200 SMA on this time frame to confirm that the path of least resistance is to the downside or that the selloff is more likely to resume than to reverse. This suggests that the channel resistance at $300 would likely keep gains in check.
Cryptocurrencies have been giving back their gains from the previous weeks as the euphoria over the launch of bitcoin futures and related products has died down. Traders are being more careful as reports on manipulation have been circulating and also likely booking profits on the lack of foreseeable catalysts for the remainder of the year.
In contrast, the dollar has been edging higher on continued tax reform developments. The House and Senate have approved the unified version of the tax bill and will soon be enacted, which would mean a big boost to U.S. companies and assets. This could keep the dollar supported for much longer while traders look forward to another set of interest rate hikes by the central bank next year.
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Risk-taking has also been in play as geopolitical troubles are taking the back seat. Of course a pickup in risks could still draw traders back to the higher-yielding LTCUSD versus other asset classes like stocks and commodities. Consolidation is also a strong possibility as traders leave their desks to enjoy the holidays soon. Be mindful of potential gaps over the weekend, though.
Posted in Trading
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