As Litecoin and Jasmy prices crash, beware of a dead cat bounce

Litecoin and Jasmy prices continued their strong sell-off on Friday as the outlook for the crypto industry darked. JASMY token plunged to a low of $0.020, its lowest swing since May 15th and 53% below its highest level this year. Litecoin price also dived to a low of $56.70, its lowest level since 2022. It has dropped by over 47% from its highest level this year. Other altcoins like Mantra, Tron, Ethereum, BNB coin, and Solana also continued falling. Why Litecoin and JASMY are fallingThere are several reasons why these altcoins are in a strong sell-off this week. First, these coins are crashing because Bitcoin formed a double-top chart pattern and has now dropped below its neckline. In most cases, this is one of the most dangerous chart patterns in the financial market.Second, the ongoing crypto crash has pushed the fear and greed index sharply lower in the past few days. It dropped to the fear zone of 38, the lowest level since November last year. As in the stock market, cryptocurrency prices drop sharply when investors are fearful.This performance happens because many holders of these assets sell them when there is a strong sell-off. It is the opposite of the fear of missing out (FOMO), which happens when these assets are soaring. Third, the Jasmy and Litecoin prices have nosedived because there is simply no catalyst or big news in the crypto industry. The big news of the year has already happened and it is unclear what the next big news will be. Bitcoin halving happened in April while the SEC approved spot Bitcoin ETFs in January. There are important macro events as well. First, in the US, there are signs that Democrats will push Joe Biden out as the next presidential candidate. Such a move will likely open the opportunity for a younger moderate Democrat to win the presidency.Donald Trump has appealed for votes from crypto enthusiasts and libertarians. As such, him losing the upcoming election will be viewed negatively by investors. The Federal Reserve has signaled that it will hold interest rates steady in the coming months since inflation has remained significantly higher. In most cases, investors move away from risky assets when the Fed has embraced a more hawkish tone.Dead cat bounce risks remainThere are signs that the ongoing crypto meltdown will continue in the near term. Besides, Bitcoin has already dropped below the 200-day moving average and the neckline of the double-top chart pattern. Therefore, there is a likelihood that JasmyCoin, Litecoin, and other altcoins will go through a dead cat bounce. A dead cat bounce happens when an asset in a steep decline rebounds briefly as investors buy the dip. In most cases, this rebound tends to be brief and results to more downside for a while. Litecoin price chartBoth Jasmy and Litecoin are showing weak fundamentals. Litecoin has formed a death cross chart pattern as the 50-day and 200-day Exponential Moving Averages (EMA) crossed each other on June 23rd. It has also dropped below the final key support at $60, meaning that bears have prevailed.Jasmy price chartJasmy price also has substantially weak technicals. It has formed a three black crows pattern, which happens when there are three straight candles. The token has also dropped below the support at $0.02767, its highest swing on March 4th. It has also moved below the 50-day and 100-day moving averages.More downsides will be confirmed if the token drops below the 200-day Exponential Moving Average (EMA) level at $0.020.The post As Litecoin and Jasmy prices crash, beware of a dead cat bounce appeared first on Invezz