However, the recent reappearance of a new technical signal on the monthly chart could suggest that this quiet phase is the calm before a storm for Litecoin’s price action.
According to crypto analyst Tony “The Bull” Severino, Litecoin’s Average Directional Index (ADX) on the monthly candlestick timeframe has bounced on the 20 level once again. The reaction to this seemingly average threshold is important because more often than not, it has signaled the start of a powerful trend for Litecoin.
He notes that in contrast, when the ADX hovered below 20 for most of the 2020 cycle, Litecoin only managed a shallow and short-lived rally. The current re-emergence of trend strength, with the ADX and +DI both gaining ground, suggests something structurally different is forming now, and it could mirror the bullish setup from nearly eight years ago.
When these chart patterns resolve after years of spiraling, they often lead to decisive moves. And when such price compression aligns with rising trend strength in the ADX indicator, as it now does, it becomes even more convincing. As such, this convergence of the technical signal alongside the chart pattern sets the stage for a possible repeat of the 2017 breakout conditions.
