If Litecoin (LTC) holds the area near $38, the technical structure could be very bullish.
That would confirm a breakout from a head and shoulders pattern with an upward sloping neckline. Even though those patterns are not conventional, breakouts from such patterns can trigger vertical up moves. The target of the pattern is in the low $50’s. The zone between $50 to $55 contains horizontal resistance, the head and shoulders target, and the 200-day moving average (Figure 1).
Conversely, if Litecoin (LTC) fails and falls definitively below $38, that could be very bearish.
Looking at Tron (TRX) vs. Bitcoin (BTC), TRXBTC filled a gap on an intraday chart and then reversed higher. Elliot wave work, which has been helpful of late in crypto, shows the possibility of a new high for the move (Figure 2).
That said, Tron (TRX) is going to run into major resistance on a two-day chart near $600 (Figure 3). If Tron (TRX) clears $600, then longs might have an advantage. If there is a rise through $600 and then a drop back below it, that could end the Tron (TRX) rally and give shorts the advantage.
The rally in Tron (TRX) seems to reflect a big theme in the crypto community that ETH has not lived up to its billing, and there needs to be an Ethereum (ETH) alternative or replacement. The Ethereum hard fork may also create substantial risk to Ethereum (ETH).
We saw one positive tweet on Ethereum (ETH) — the tweet suggesting Ethereum (ETH) may become the first cryptocurrency to have decreasing supply over time. That’s really interesting, to say the least.
From a chart point of view, Ethereum (ETH) is holding above horizontal support at $152. Ethereum (ETH) seems to trade heavy. A confirmed break below $152 would be negative and create risk that the recent rally gets unwound.
Conversely, a break above an arc consolidation near $166 could trigger a move to a Fib extension level and horizontal resistance zone at either $182 or $212 (Figure 4).
Bottom Line: If Litecoin (LTC) continues to lead on the upside, it could bring Ethereum (ETH) along with it …. and vice versa. The coins that people love to hate are at key pivots. The next definitive tactical move in either direction could start a material trend.
The Crypto.IQ Trading Room has levels set up to take advantage of the technical setups in both Litecoin (LTC) and Ethereum (ETH). Join us as we watch this play out.