Disclaimer: The information presented does not constitute financial, investment, trading or other advice and is solely the opinion of the author.
- Litecoin falling below $90 could encourage the bears.
- The market structure of the 4-hour as well as the daily timeframe favored the sellers.
Litecoin fell below the range it has traded in since early February. In doing so, he shifted the bias heavily in favor of the bears. The sharp drop highlighted the huge selling pressure a few days ago and the volume was huge as well.
Read it Litecoin [LTC] Price forecast 2023-24
This happened at the same time that Bitcoin dropped from $23.5k to $22k on Fri, Mar 3. While BTC had some upside hope, Litecoin showed that further losses can be expected.
Partially filling the gap in fair value can offer short sellers decent entry
Litecoin fell sharply from $95.4 to $88.8 within a 4-hour candle. The session closed below the bottom of the range at $90.5, but was still within the bullish order block in that zone, highlighted in cyan.
This decline highlighted two things. One was that the bias was strongly in favor of the bears, which was reinforced at the close of H4 below the bullish order block.
Another was that a large imbalance was left in the rankings. Not all imbalances could be fully filled, but 50% filling was a possibility. If this scenario plays out for LTC, the coin will rise to the $92.8 resistance level before facing a rejection.
The RSI has been below the neutral 50 since March 2nd to indicate a bearish trend in progress. Meanwhile, the OBV has been at a support level since February and has shown that selling pressure is dominant in March.
Realistic or not, here it is The market cap of LTC in BTC conditions
Things were a bit tricky because even a partial FVG fill would break the structure and turn it bullish.
Therefore, buyers should be cautious until a break above $95. Short sellers can try to enter the market on a retest of the $89-$90 area, with a tight stop-loss above recent lower highs at $91.9 and a take at $85 support.
Falling prices sent Open Interest rising as the bears took hold
On the 15-minute chart, we can see falling prices over the past 24 hours.
OI, which was flat for a while, has revived and started a strong uptrend in recent hours.
This indicates that short sellers are likely entering the market and outlines strong bearish sentiment behind Litecoin. However, the projected funding rate remains positive.
Findings from the futures market suggest that a sharp move down could occur in the coming hours.
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