Litecoin is a peer to peer internet currency that offers near zero transaction cost and is almost identical to Bitcoin. For that reason, the price chart tends to follow Bitcoin closely and can be considered for alternate trades when Bitcoin develops a signal.
Recently the entire space retraced thanks to Bitcoin coming off of the low 60K area resistance. As Bitcoin finds stability between the 50 and 55K area, Litecoin is likely to do the same.
There is a lot of hype and hope baked into these coins, and is very prevalent in this space. We pay no attention to it, and instead evaluate the risk, potential rewards and price action over a smaller time horizon (a swing trade).
As long as Litecoin (and Bitcoin) can hold their recent support levels (230 for LTC) there is a chance price attempts to push for the high at least one more time. Such a move offers an attractive reward/risk and is worth a try. This is NOT to be confused with a long term investment, since current prices are much less attractive on such a time horizon.
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Here’s the trade idea:
Stop Loss: 230
Target 1: 300
Target 2: 330
Target 3: 360
Please keep in these orders are part of a rules based swing trade strategy. They are setup in a way to help minimize getting caught in price noise, fake outs and would be stop outs.
While there is no perfect way to avoid a negative trade, following a rules based entry and exit process helps to improve consistency and reduce the effects of the highly random nature of the market environment.
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