Litecoin is nearing oversold levels – What will the price of LTC be next?

Litecoin (LTC) has lost 2.3% of its value in just one day, causing its market capitalization to shrink to 6.4 billion dollars amid increasing selling pressure. This sharp decline has pushed a series of technical indicators deep into the negative zone, with market momentum showing clear signs of weakness.

The RSI index is currently approaching the oversold threshold, while both the Ichimoku Cloud model and the EMA lines are signaling a prolonged downtrend. If a solid support zone is not established soon, LTC may continue to drop further before any significant recovery can occur.

RSI Litecoin is near the oversold zone as momentum weakens

The relative strength index (RSI) of Litecoin has fallen sharply to 35.92 – a significant drop from 61.4 just 1 day ago. This rapid decline indicates that market momentum has clearly reversed in a short time.

RSI is a tool for measuring the speed and intensity of price fluctuations, often used to determine the overbought or oversold condition of an asset. An index above 70 signals that the market is overbought, posing a risk of correction. An index below 30 reflects an oversold condition, often suggesting a potential recovery. Meanwhile, the zone from 30 to 70 indicates a neutral trend or a consolidation phase.

With the RSI currently close to the oversold threshold, LTC may face the risk of further weakness if it does not soon find supportive buying power.

The RSI of Litecoin | Source: TradingViewWith the RSI of Litecoin currently hovering just above the oversold threshold, the indicator shows that the bullish momentum is weakening and selling pressure is increasing.

Although the level of 35.92 has not yet confirmed an oversold condition, it places LTC in a dangerous zone close to levels where buyers might start looking for value opportunities. If the RSI falls below 30, it could signal a potential bottom and a short-term recovery.

However, if pessimistic sentiment continues to rise, the RSI remains constrained, indicating greater downside risk before any significant recovery occurs.

LTC is threatened as Ichimoku Cloud turns red

The Ichimoku Cloud chart for Litecoin currently shows a bearish configuration, with the price action significantly lower than the red cloud (Kumo), indicating bearish momentum.

The Leading Span lines — Senkou Span A (green) and Senkou Span B (red) — form a red cloud ahead, indicating that the bearish trend may continue in the short term.

A thick red cloud often reflects strong resistance levels above the current price, making upward breakouts more difficult unless the momentum changes drastically.

Ichimoku Cloud of LTC | Source: TradingViewIn addition, the Tenkan-sen (blue line) has crossed below the Kijun-sen (red line), further confirming the bearish trend.

This crossover reinforces the short-term weakness, while the cloud ahead remains flat, signaling a lack of bullish confidence or expanding volatility.

With the price candle continuing to move down from the cloud, the chart shows little sign of an immediate trend reversal.

Litecoin hovers near an important support level as the EMA continues to fall

The price of Litecoin is currently fluctuating around the important support level of $83.11, with price action showing signs of weakening momentum.

The EMA structure is falling, as the short-term moving averages remain below the long-term moving averages, which is generally understood as a signal to continue downward.

If this support level cannot be maintained, LTC may slide down to lower levels, with $81.3 being the next potential downside target.

LTC Price Analysis | Source: TradingViewHowever, a change in momentum could lead to a recovery, especially if Litecoin regains higher levels and retests resistance at $89.31.

Dinh Dinh