A further decline in Bitcoin (BTC) could, however, lead to further losses for LTC, given the strong correlation between their price movements.
Litecoin (LTC) is one of the major altcoins that suffered heavy losses following the Bitcoin flash crash that triggered widespread sales in the cryptocurrency market.
The 14th-ranked cryptocurrency plunged 18% on Tuesday to break away from major support levels. Even with today’s rebound, LTC’s price is still down 11% from its 24-hour open value.
But the bulls are likely to push higher, with targets near the psychological levels of $ 200 and $ 230.
According to technical analyst Ali Martinez, LTC is still bullish despite the 18% plunge seen on Tuesday. According to the analyst, the Litecoin network saw an increase in new addresses, which suggests an influx of “new money” as investors remain confident in the rise in the price of Litecoin.
#Litecoin bull run isn’t over yet! 🚀
The number of new addresses joining the $LTC network continues making higher highs. Nearly 220K new addresses were created yesterday.
– Ali Martinez (@ali_charts) September 7, 2021
However, the bullish outlook may not hold if Bitcoin (BTC) continues to fight downward pressure around $ 46,000. If the benchmark cryptocurrency experiences a further decline, a cascading effect in the market could include a plunge in Litecoin’s price to new lows.
Litecoin Price Outlook
LTC / USD remains above a crucial buffer zone on the daily chart, suggesting that the bulls may be looking at further gains if market sentiment improves.
LTC / USD daily chart. Source: TradingView
The horizontal support line around $ 165 that currently anchors LTC did the same in February and March of this year, providing the springboard that pushed Litecoin prices to new all-time highs of $ 410 reached in May.
If the bulls overcome resistance at $ 185, they could aim for $ 200, then September 5 highs at $ 233.
The flip side could see the LTC / USD pair move into a range between $ 165 and $ 185, with the 200 EMA on the daily chart being a pivot point near $ 170.
The RSI and MACD indicators suggest that the bears are in control, and the daily candlestick is currently depicting a struggle between the rise and the fall. If sellers break through the support zone and there is a further descent below $ 160, the price of Litecoin could accelerate its decline to the previous support level around $ 142.
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