Litecoin price has formed a head and shoulders pattern.
The US will publish the latest inflation data on Tuesday.
The Fed will deliver its rate decision on Wednesday.
Litecoin price formed a small doji pattern ahead of the upcoming US inflation data and central bank decisions. It dropped to a low of $73.50, the lowest level since November 29. It has crashed by more than 12% below the highest level this year.
Inflation and central bank decisions
Litecoin and other cryptocurrencies have pulled back on Monday ahead of what will be a busy week. On Tuesday, the US will publish the latest American consumer inflation data. Economists expect the data to show that inflation dropped in November.&
Precisely, they expect that the headline consumer price index (CPI) dropped from 7.7% in October to 7.3% in November. Supporting this view is the fact that gasoline prices have crashed to the lowest level in more than 12 months.&
Core inflation, which excludes the volatile food and energy products, is expected to have dropped from 6.5% to 6.0%.&
These numbers will come a day ahead of the Federal Reserve interest rate decision. Economists expect the data to show that the Fed will deliver a relatively mild rate decision this week. Precisely, they believe that the bank will hike rates by 0.50%, lower than the previous increases of 0.75%.
In addition to the Federal Reserve, other major central banks like the Bank of England (BoE) and the European Central Bank (ECB) will deliver their rate hikes.&
Historically, Litecoin price tends to react negatively to higher interest rates. Therefore, a sign that they will likely slow its rate hikes in 2023 will be a bullish sign.&
Meanwhile, Litecoin’s hashrate has started rising. Data shows that LTC rose to 567 TH/s on Monday. This increase was higher than last week’s low of 528 TH/s. Hashrate is an important figure that measures the health of the network, as I wrote& here.
Litecoin price prediction
The LTC price has been under pressure in the past few days. It has managed to move below the 25-day and 50-day moving averages while the Relative Strength Index (RSI) has moved below the neutral level. It is also slightly above the important support level at $73.50, the lowest level on November 26.
The coin has also formed a head and shoulders pattern. In price action analysis, this pattern is usually a bearish sign. Therefore, Litecoin price will likely resume the downward trend. If this happens, the next key support level to watch will be at $65. A move above the resistance at $75 will invalidate the bearish view.
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The post Litecoin price prediction: US inflation, Fed decision appeared first on CoinJournal.
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