Litecoin is among the crypto market leaders today, surging 6% intraday while Bitcoin remains flat. The single-day rally in LTCUSD might be enough, however, to generate a near-term buy signal using the Bollinger Bands. What might this mean for the altcoin, and could this be a sign that a more positive trend is beginning?
Possible Buy Signal Setup Lights Up In Litecoin
Litecoin has been among the most painful coins to hold over the last several years. In 2017, the silver to Bitcoin as digital gold went on a monumental, nine-month rally. During that nine-month stretch, Litecoin gained over 10,000% and put the coin in the top ten cryptocurrencies by market cap.
A lot has changed since then, with Litecoin now ranked number 18 by market cap, barely holding onto top 20 status. The altcoin has mostly trended sideways for the past seven years since the 2017 bull run, much to the disappointment of investors.
Brighter days might be ahead, at least in the near-term, as LTCUSD is working on a buy signal according to the Bollinger Bands.
Litecoin is working on a buy signal supported by breakout volume
All About The Bollinger Bands And How To Use Them
The Bollinger Bands aren’t just a technical indicator, but act as a complete trading system. The tool is primarily used to gauge volatility, as the bands tighten and narrow when volatility is low. When the bands begin to expand, it is a sign that volatility is returning.
Beyond that, however, the Bollinger Bands can also generate a buy and sell signal depending on where price is relative to the upper and lower bands. Each band is set at a +2 standard deviation from the middle-line, which is a 20-period simple moving average.
The idea is that only the strongest and most likely to be sustainable moves make it outside the upper or lower band. A 6% surge today in LTCUSD was enough to make it above the upper Bollinger Band. A close above the upper band is necessary to confirm the buy signal, especially when supported by higher than normal volume. A volume downtrend has been broken, checking this additional box in setting up the coin for a buy signal.
Tony Severino, CMT is the author of the . Sign up for . Follow & on Twitter. Or join the for daily market insights and technical analysis education. Please note: Content is educational and should not be considered investment advice.
Featured image from ChatGPT, Charts from TradingView.com
Tony "The Bull" Severino, CMT, is a distinguished figure in the cryptocurrency analysis sector, renowned for his in-depth technical expertise and innovative approach to market trends. As the Head of Research at NewsBTC, Tony leads a team dedicated to providing cutting-edge insights and forecasts, helping both novice and experienced traders navigate the complexities of the crypto market.
A seasoned Chartered Market Technician, Tony's prowess in identifying and capitalizing on market patterns is unmatched. His academic and professional journey in market analysis has firmly established him as a leading authority in technical trading strategies. Tony’s approach is heavily influenced by the principles of Elliott Wave Theory, a method known for its rigorous assessment of investor psychology and price movements.
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Beyond his role at NewsBTC, Tony is the visionary founder of CoinChartist.io, an educational platform aimed at demystifying the nuances of cryptocurrency trading. CoinChartist.io serves as a valuable resource for traders seeking to enhance their technical analysis skills. The platform offers a range of learning tools and resources designed to empower traders with the knowledge to make informed trading decisions.
In addition to his educational initiatives, Tony is a prolific author and a dominant voice in the crypto community. He writes the CoinChartist VIP newsletter, a weekly dispatch that has become a staple among crypto enthusiasts, revered for its insightful analysis and actionable trading advice. This newsletter has consistently ranked as a best-seller on SubStack, boasting thousands of subscribers who rely on Tony’s expertise to guide their trading strategies.
Tony is also celebrated for his literary contributions to the field. He is the author of the highest-rated Crypto Trading Journal on Amazon.com, a testament to his ability to communicate complex trading concepts in an accessible manner. This journal is widely regarded as an essential tool for traders aiming to track their progress and refine their strategies.
Before his ascent in the financial analysis world, Tony honed his skills in journalism. His background in this field has endowed him with a unique ability to present intricate market dynamics in a clear and compelling manner, making his insights highly sought after by a broad audience that ranges from casual readers to professional traders.
His professional affiliations underscore his commitment to excellence and continuous learning. As a partner of Elliott Wave International and TradingView, Tony collaborates with other leading experts to enhance his knowledge and skills. His active membership in the CMT Association further aligns him with the highest standards of industry practices and ethics.
Tony’s nickname, "The Bull," aptly reflects his aggressive and optimistic outlook on the cryptocurrency markets. His forecasts often anticipate significant upturns, earning him a reputation for bullish predictions that have frequently led to lucrative outcomes for those who follow his advice.
In summary, Tony "The Bull" Severino, CMT, is more than just a technical analyst; he is a mentor, educator, and innovator whose influence in the cryptocurrency space continues to grow. His dedication to advancing the understanding of market forces and his commitment to providing high-quality, reliable analysis make him a pivotal figure in the world of cryptocurrency trading.
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