Litecoin Rainbow Chart by Crypto Lama

This script adapts the popular Bitcoin Rainbow chart to Litecoin to visualize Litecoin's long-term price trend on a logarithmic scale.

It highlights potential buying or caution zones based on a power law growth model tied to Litecoin's halving cycles.

What it does:
The indicator overlays 23 colored bands from purple/blue (undervalued) to orange/red (overvalued) around a power law trend line.

It supports forward projections by extending the chart with user-defined future bars.

How it works:
The core trend uses a power law formula: P(t) = 10^(0.5 + 4.34 * log10(h + 1)), where h represents time in halving cycles.

23 colored bands are constructed by applying multipliers with a decaying factor that narrows over time.

To put it simple, it is the same power law trendline shifted up or down 23 times.

For projections, it adds future bars to the timeline and recalculates the trend and bands accordingly.

How to use it:
Apply the indicator to a Litecoin chart (VANTAGE:LTCUSD for best results).
Adjust the "Future Bars" input to extend projections, usually staying below 600 future bars prevents visual bugs.

Blue/green bands signal potential accumulation zones, as has been demonstrated for Bitcoin, an average price close to these levels will likely prove to be an excellent buying opportunity, while orange/red suggest distribution or caution.

This indicator should be used to visualize the macro long-term trend of Litecoin, and it is not supposed to be used for short-term forecasts as its accuracy decreases.

Originality:
While inspired by Bitcoin's Rainbow Chart, this version is customized for Litecoin by incorporating its unique halving schedule and calibrated power law parameters in the power law formula, offering a tailored tool for LTC-specific analysis.

Note: This is not financial advice. Use it alongside other tools and manage risks appropriately!