LTCUSD Technical Analysis for 10/06/2017 – Bearish Channel Correction

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LTCUSD continues to trend lower and is moving inside a bearish channel connecting the highs and lows since the start of the month. Price is currently testing the channel resistance just below the $52 level.

This lines up with the 61.8% Fibonacci retracement level on the latest swing high and low. It is also below the 100 SMA, which could act as a near-term ceiling in the event of a larger correction. If any of the resistance levels hold, price could fall back to the swing low at $50.16  or until the channel support closer to $50.

The 100 SMA is below the longer-term 200 SMA so the path of least resistance is to the downside. This means that the downtrend is more likely to continue than to reverse. Also, the gap between the moving averages is widening so selling pressure is getting stronger.

Stochastic is heading lower to indicate that bears are in control of LTCUSD price action. RSI, on the other hand, appears to be turning higher to indicate the presence of bullish momentum. A break past the channel resistance could still encounter a roadblock at the 200 SMA dynamic inflection point, though.

Cryptocurrencies have been sliding lower on improving risk appetite these days as investors seem less concerned about a potential attack from North Korea and are putting more focus on economic data and monetary policy changes. In particular, the US dollar is waiting on the NFP report to gauge whether a December Fed rate hike is likely or not.

Analysts are expecting to see 88K in hiring gains, around half the previous 156K increase. Leading indicators have been pointing to an upside surprise, but there’s no telling how the official data collection might have been affected by the recent hurricanes. Traders are also likely to pay close attention to the average hourly earnings figure as policymakers are hoping to see more wage growth to factor into stronger inflation down the line.



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