Litecoin Daily Chart – Source: Tradingview.com

After a brief consolidation yesterday, Litecoin continued its surge which it started on Sunday.

The initial surge was preceded by an inverse head and shoulders pattern, and after increasing 10% against the USD, other major cryptocurrencies started following.

The big question for analysts today is whether we are seeing a repeat of this?

Bitcoin Daily Chart – Source: Tradingview.com

The surge which took place in Bitcoin on Sunday failed to surpass its prior high at $4240 – as shown by the red arrow on the chart above.

A follow-up surge which brings price action above this point would be bullish for price action.

However, if the price does surpass this point, it is likely to meet some resistance at $4350.

$4350 to $4550 was an area of consolidation during the bearish crash which took place in mid-November before price continued its drop. It would be a likely area of seller liquidity.

Bitcoin 4-Hour Chart – Source: Tradingview.com

The shorter-term 4-hour Bitcoin chart shows price action starting to increase in recent candles.

If Litecoin is leading the market, this increase is likely to accelerate over the next few candles.

If the price drops from here back below $4000, the next key support level to monitor is $3700.

Key Takeaways:

  • Litecoin is surging once again and may be paving the way for a surge in Bitcoin.
  • The last surge in Bitcoin failed to overcome the prior high at $4240.
  • If the price manages to overcome $4240, $4350 will be expected to come into play as resistance. If the price drops back below $4000, $3700 is the next area of support to monitor.

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