Litecoin – Double Bottom and Higher Low formation.
The chart is showing two bullish patterns which are Double Bottom and Higher Low formation. This is second time when the price visits support zone and tests it. This is important zone for bulls to defend to maintain bullish structure of higher low which is crucial for the beginning of an uptrend (read more in the educational information).
Both of these patterns are supporting each other and they are often very first signals (not fully confirmed yet) of possible trend change.
An uptrend consists from two different things higher highs and higher lows. When you think two of these, then higher low is that usually gives the very first signal for the beginning of an uptrend while higher high usually confirms it.
Double Bottom is a bullish reversal pattern which often occurs at the bottom of the market. The break out can be confirmed when the volume starts expanding together with the price breaking through of neckline.
Patience is the key
What’s important to keep in mind here is that the price still needs to take down 86.7 level before able to push higher and this is level which acts as bullish break out confirmation. The price is located in the area where it’s attractive to open smaller positions and start increasing it when the trend change does happen eventually. When the volume starts increasing and about to break out then 86.7 level can be good entry point for longer term investments.
It’s really good to wait until the market starts showing more confirmed trend reversal signals before entering with any bigger positions. Without signals or setups you end up building terrible trading habits and in the longer term it will make you suffer trading wise. That’s why it’s important to resist trades without setups or with huge amount of FOMO.
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Things to Remember:
Stop-loss orders are strongly recommended.
Beware of buying tops or FOMOS, you might end up losing or waiting long periods of time before getting anything back.
Do your homework before investing.