Litecoin Buy Power Remains High

While Bitcoin and other major cryptocurrencies are showing some signs of retreat, Litecoin is gaining strong momentum, positioning itself as a compelling candidate for portfolio additions.

From a technical perspective—which we’ll break down in detail in this analysis—you’ll have all the necessary information to effectively manage this potential trade better.

Daily time frame analysis

LTCUSD - 1 Day Time Frame

First and foremost, it’s important to highlight that at the beginning of February, Litecoin experienced a strong bullish surge, which has yet to be counterbalanced. This dynamic is clearly depicted on the attached chart, where a support zone is marked between two horizontal lines.

Currently, the price on the daily timeframe has entered this support zone but has respected it precisely, signaling that bullish forces remain dominant. This reinforces the buying context, as the market perceives bullish parameters to be significantly stronger than bearish ones.

Beyond the support zone, the next critical step is to monitor the nearest resistance zone, which will serve as the final confirmation for entering buy positions. On the attached chart, this resistance is marked in orange, and since we are working with the daily timeframe, the daily candle must close above the upper boundary of this zone for confirmation.

Litecoin price target

Once the resistance zone is cleared, traders and investors should ensure proper risk management by following two key steps. First, setting a stop loss order is below the internal low is recommended to protect against unexpected reversals.

Next, defining take profit levels is key. The buy-side liquidity zones indicated on the chart may serve as appropriate take profit levels for Litecoin buyers.

By following this structured approach, traders can maximize their risk-to-reward ratio, ensuring a strategic and well-managed trade execution.