Litecoin price has been rising in stair-step fashion throughout the winter, suggesting a well-established uptrend will continue higher. Resistance near the current price levels, however, should not be underestimated. Even if bulls continue pushing higher, there is a risk of institutional investors front-running Litecoin price higher.

On January 20 and 23, the bulls prompted their second attempt, but the ascent was short-lived. The bulls formed a local high of $92 before pulling back and consolidating once again below the psychological $90 level. The third attempt was no different: a new high at $93 though well-established, failed to sustain the uptrend in LTC price once again.

Litecoin price currently auctions at $87.16. The turbulence witnessed over the last few weeks near the $90 zone could be viewed as a waning trend signal. While many investors are anticipating Litecoin to reconquer the $100 level, the local rejections near $90 suggest profit-taking is already occurring underneath the hood.

The Relative Strength Index, an indicator used to gauge the underlying strength of the trend, compounds the bearish notion. The indicator continues to decouple and detrend away from Litecoin's rising price. The RSI continued to print lower highs during Litecoin’s rally from $90 to $93 between January 14 -January 23 – a bearish sign

Considering these factors, investors aiming for $100 may get front-runned by smart money market players. Trader’s solely focus on price forming new highs may be unaware of the underlying resistance forming near the current price levels. If the market is genuinely headed south, a retracement to the $80 zone, tagging the January 19 liquidity level at $83 in the process, would be a high-probability trade setup.

For traders looking to enter the market, invalidation of the bearish thesis could arise from a break above the $93 swing high. A barrier breach would likely induce the anticipated run up to $100, constituting a 15% increase, if the bulls were to succeed.

LTCUSD going for a higher high before strong bearish correction

Jan 26 2023