Litecoin Price Prediction: US Inflation, Federal Reserve Decision

adminDecember 3, 2023

Litecoin price formed a head and shoulders pattern.
The United States is scheduled to release its latest inflation data on Tuesday.
The Federal Reserve is expected to announce its interest rate decision on Wednesday.

Litecoin price formed a small doji pattern ahead of upcoming US inflation data and central bank decisions. It fell to $73.50, the lowest since November 29th. It is down more than 12% from this year’s high.

Inflation and Central Bank Decisions

Litecoin And other cryptocurrencies pulled back on Monday ahead of a busy week. On Tuesday, the United States is scheduled to release the latest U.S. consumer inflation data. Economists expect the data to show inflation falling in November.

To be exact, the Consumer Price Index (CPI) was expected to fall from 7.7% in October to 7.3% in November. Supporting this view is the fact that gasoline prices have fallen to their lowest level in more than 12 months.

Core inflation, excluding volatile food and energy products, is expected to fall from 6.5% to 6.0%.

The numbers will come out a day before the Federal Reserve’s interest rate decision. Economists expect data to show the Federal Reserve will make a relatively mild interest rate decision this week. To be precise, they believe the bank will raise interest rates by 0.50%, lower than the previous increase of 0.75%.

In addition to the Federal Reserve, major central banks such as the Bank of England (BoE) and the European Central Bank (ECB) are planning to raise interest rates.

Historically, Litecoin price tends to react negatively to interest rate increases. So any sign that interest rate increases are likely to slow in 2023 would be a positive sign.

Meanwhile, Litecoin’s hash rate began to rise. Data shows LTC rose to 567TH/s on Monday. This is a higher increase than last week’s low of 528TH/s. Hashrate is an important measure of the health of the network, as I wrote. here.

Litecoin price prediction

LTC/USD Chart by TradingView

LTC price has been under pressure over the past few days. While the Relative Strength Index (RSI) moved below the neutral line, it fell below the 25-day and 50-day moving averages. It is also slightly above the important support level of the November 26 low of $73.50.

The coins also formed a head and shoulders pattern. In price action analysis, this pattern is usually a bearish signal. Therefore, Litecoin price is likely to resume its downward trend. If this happens, the next major support level to watch would be $65. A move above the $75 resistance will invalidate the bearish outlook.

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