LTCUSD price has been treading sideways, moving inside a consolidation pattern on its daily time frame. Price made lower highs and found support at 3.050, creating a descending triangle formation.
LTCUSD appears to be bouncing off the bottom of the formation and might be headed back to the top. The 100 SMA is above the 200 SMA for now, confirming that the path of least resistance is to the upside.
Also, stochastic is moving out of the oversold zone, so buyers might be ready for a strong push up to the top of the triangle at 3.500. A breakout in either direction could lead to directional plays for litecoin.
RSI is on middle ground and barely offering strong hints at the moment, although the oscillator appears to be on its way up. This suggests that buyers are taking the wheel and might have enough strength for more gains.
However, event risks this week and the return in risk aversion are both supporting the US dollar. Even though inflation data and Fed rhetoric earlier on weighed on the currency’s gains, the risk-off flows are still moving towards the safe-haven US currency.
US ADP non-farm employment change data is due today, along with the ISM non-manufacturing PMI. On Friday, the NFP report will be released and another strong gain in hiring could mean more dollar rallies.
Also lined up this week is the BOE statement, during which central bankers might admit that the global slowdown and fall in oil prices is weighing on their outlook and rate hike forecasts. BOE Governor Carney previously spoke about the lack of time line when it comes to tightening and he might reiterate this dovish bias, thereby dampening traders’ appetite for risk.