Litecoin (LTC) lost a major psychological battle after it crashed below the $50 support level. With the price currently at a 4-year low, another $3 drop would mean that LTC could crash to 6-year lows.
Litecoin lingers in a critical price zone
According to a crypto netizen, who goes by the pseudonym Crypto Patel on X, LTC is currently at a 4-year low level as it is priced at $43 at the time of writing. Another drop below the $40 support level will see the coin crash to 6-year lows as shown in the chart below.
Litecoin loses bullish symmetrical triangle trajectory
Having fallen out of the bullish symmetrical triangle, Litecoin (LTC) now faces a crucial test. Symmetrical triangles are generally viewed as continuation patterns, and traders often expect the price to break out in the direction of the prevailing trend. However, LTC’s breakdown below the lower boundary of the triangle suggests that bearish pressure has overwhelmed buyers, at least in the short term.
For the bulls, reclaiming the lost structure will not be easy. They will need to generate significant buying momentum to push LTC back above the triangle’s lower trendline and sustain trading within the pattern (above $90). A successful recovery would indicate that the recent breakdown was merely a fakeout, trapping bearish traders before a renewed upward move.
The lower trendline could act like a hindering resistance
On the other hand, failure to re-enter the triangle could have negative implications for LTC’s price action. The former support line may now act as resistance, making it more difficult for buyers to regain control. In such a scenario, traders could look for lower support levels as potential downside targets.
Market participants will also be watching trading volume closely. A strong increase in buying volume would suggest that investors are accumulating LTC at current levels, while weak volume could indicate a lack of conviction among bulls. The coming sessions may therefore determine whether LTC can restore its bullish structure or extend its correction further.
As shown in the chart above, the current price range that Litecoin is trading in has a lot of buying activity. Hence, there is a high chance that the price may not fall to 6-year low levels—below $40, as the buyers might enter the market and cushion the falling the prices.
