Litecoin has formed a triple-top pattern on the daily chart.
The main news is the recent lawsuits against Coinbase and Binance.
The Federal Reserve will deliver its next interest rate decision.
Litecoin price has come under intense pressure in the past few days as investors focus on the recent SEC lawsuits against Coinbase and Binance. LTC token retreated to a low of $73.98, lower than the year-to-date high of $105.70.
Fed interest rate decision
Litecoin, like other cryptocurrencies, is going through a rough patch as investors focus on last week’s lawsuit by the SEC. The lawsuits alleged that the companies provided unregulated securities in the United States. The agency also sued Binance’s Chief Executive, Changpeng Zhao, as we wrote here.
It is stil too early to predict the next outcome of these lawsuits. As we have seen with the ongoing SEC vs Rippple case, the process can last for several years. The most likely outcome will be a settlement between either Binance or Coinbase with the SEC. Alternatively, the two companies could lose the suits, leading to major implications foe the crypto industry.
For example, if Coinbase loses, it means that the company will be forced to delist thousands of cryptocurrencies. Popular coins like Bitcoin and Litecoin will be safe since they are seen as commodities.
The next key catalyst for the LTC price will be the upcoming interest rate decision by the Federal Reserve scheduled for Wednesday. Analysts believe that the bank will leave interest rates unchanged at between 5% and 5.25%.
A pause in interest rate hikes will be a positive thing for Litecoin, stocks, and other financial assets. For one, it will be the first time in 10 meetings that the Fed has not hiked interest rates.
The decision will come a day after the US publishes consumer price index (CPI) data. Analysts believe that the headline consumer price index (CPI) dropped to 4.1% in May from the previous 4.9%.
Litecoin price prediction
Turning to the daily chart, we see that the LTC price has formed a triple-top pattern at $105.70, where it struggled moving above this year. The neckline of this pattern is at about $65.60. The coin has moved below the 50-day and 100-day moving averages.
The Relative Strength Index (RSI) has moved below the neutral point at 30. Therefore, I suspect that the LTC price will continue falling as sellers target the key support at $65.60. A move below that level will open the possibility of the coin dropping to $60.