At first glance, the price of Litecoin may appear to have moved sideways since the sharp decline in early October. However, a closer look at the recent price action suggests that a potential buy setup is forming. The key focus now is identifying the relevant technical parameters and the potential risks that may influence whether a new upward movement develops.

Litecoin technical analysis

LTCUSD - 1 Day Time Frame

The first parameter supporting the bullish scenario is the impulsive selection of Sell-Side Liquidity, which was immediately followed by a similarly strong upward reaction. From an order-flow perspective, this is significant: early buyers ultimately acted as counterparties for commercial market participants once their Stop Loss (Sell Stop) orders were triggered, matching with institutional Buy Limit orders.

As is typically the case in similar structures, price behaviour during a retest of the most recent resistance zone remains essential. Following the liquidity collection, the subsequent impulsive move closed through that resistance area, effectively converting it into support — an important indication of a potential shift in market structure.

Litecoin price target

Risk management remains a crucial component of any market approach. One common element is determining the Stop Loss placement before entering a position. For Litecoin, a protective level could be positioned below the internal low highlighted on the attached chart.

On the upside, potential profit-taking areas can be found near this year’s high, where a notable pool of Buy-Side Liquidity is located. If the price were to reach this level, the position could experience an appreciation of more than 50%, although such an outcome is never guaranteed and depends entirely on market behaviour.