Litecoin (LTC) has shown a notable decrease in volatility, with a crypto expert pointing out a rare tightening in its bi-monthly (2M) Bollinger Bands (BB). The current technical setup for Litecoin suggests a strong potential for a parabolic breakout, with $130 identified as a crucial resistance level.
Narrow Bollinger Bands To Trigger Litecoin Breakout
Noted crypto analyst Tony Severino shared a price chart on X (formerly Twitter) displaying Litecoinโs price movement over a bi-monthly period, using Bollinger Bands as a tool to assess cryptocurrency price volatility. Bollinger Bands analyze market volatility by creating upper and lower bands around a Moving Average (MA) that serves as a baseline.
Severino has observed that Litecoin’s 2M Bollinger Band width is extremely narrow, signaling a lack of volatility or a significant decrease in it. Typically, Bollinger Bands expand during high volatility periods and contract during low volatility.
Severino’s Litecoin chart illustrates the upper Bollinger Band represented by a red line, the baseline by a blue line, and the lower band in the green zone. The analyst noted that Litecoin’s candlesticks are currently above the baseline at $83.3, indicating potential bullish momentum.
If the price of Litecoin continues to rise and surpasses the upper Bollinger band around $130, Severino anticipates increased volatility and a significant price breakout. Historically, an extremely narrow Bollinger Band often signals a potential shift to a bullish trend following a consolidation phase.
Severino’s analysis identifies the upper BB at $130 as a critical resistance level for Litecoin. If Litecoin manages to sustain a breakout above this level over an extended period, it could lead to further gains, potentially pushing Litecoin well above its current market value of about $111.5.
According to CoinMarketCap, Litecoin has seen modest gains, rising by 6.14% in the past day. Over the previous week, the popular cryptocurrency has experienced a more significant surge of approximately 11.7%. To reach the critical $130 resistance level, Litecoin would need to climb by around 18% from its current market price.
Litecoin Rally Forecasted, Aims for 38% Upside
According to crypto analyst Mike on X, Litecoin is preparing for a substantial breakout to a new price high. He predicts that Litecoin will experience a 38% price rally from the breakout point at $106, aiming to reach a fresh bullish target of $146.67.
Examining the analyst’s price chart, Litecoin seems to have broken the $102 resistance and is moving towards the next critical resistance at $122.77. The chart also highlights horizontal lines denoting important resistance levels for Litecoin.
Mike has identified a key support level at $99.91, serving as a potential safety net for Litecoin in case of a downtrend. Should Litecoin face a significant drop below this support, the analyst points out $86.97 and $74.43 as the next likely support levels.
Featured image from Pexels, chart from TradingView
