“The upward momentum in Litecoin (LTC) prices temporarily halted at $72, following an impressive rally that commenced from October’s support level of $60. An initial surge leading up to the halving event drove LTC to peaks of $115. However, the harsh crypto winter soon overshadowed the coin, erasing all its year-to-date gains.
As a Bitcoin fork with a market capitalization of $5 billion, Litecoin currently ranks 17th among other cryptocurrencies. It has undergone a significant decline of 83.46% from its all-time high of $410 but still maintains a substantial 5,800% increase over its all-time low of $1.15.”
Litecoin Price Technical Analysis as Previously Dormant LTC Coins Begin to Move
“On Thursday, Litecoin’s price experienced a setback after an impressive rally that had been ongoing for over a week. It was anticipated that the $70 support level, which had now turned into resistance, would absorb the selling pressure. However, the bulls at this price point were overpowered, leading to a more significant decline to $66.”
“On Friday, Litecoin has made a recovery, currently trading at $67.67. However, the coin’s momentum has notably waned. This suggests that if the immediate support at $67 is breached, Litecoin may dip further to seek fresh liquidity before commencing a rebound.
The Directional Movement Index (DMI) is approaching a critical juncture that could be pivotal in determining whether the downtrend will persist or if the uptrend will resume in the near future.
Traders considering short positions on LTC should ensure that the blue +DI line has successfully crossed below the red -DI line before executing their sell orders. Conversely, those seeking fresh long positions in LTC should confirm that the +DI line remains above the -DI line and is diverging from it.
The fact that the 100 Exponential Moving Average (EMA) in blue remains above the longer-term 200 EMA in purple suggests that bulls maintain an advantage despite the correction. Therefore, traders may want to allow Litecoin some time to resolve the current situation before deciding on their strategies to lock in gains.
If the price dips below the immediate support at $67, Litecoin could revisit the subsequent support level at $66. However, if the declines intensify, bears may set their sights on $64 and the lowest support reached in October at $60.”
Spike in Previously Dormant Litecoin (LTC)
“Santiment, the blockchain data analytics platform, has provided fresh insights into the activities within the Litecoin network. These findings reveal a notable surge in protocol activity, with the number of addresses actively engaging on the blockchain rising sharply to 319,000, coinciding with the recent surge in cryptocurrency prices.
Notably, there has also been a significant increase in whale transactions, returning to levels last observed in June. However, the most significant observation is the movement of previously dormant LTC coins. When these dormant coins start to circulate, it signals a greater circulation of coins, which in turn contributes to heightened volatility in the market.”
Consequently, there are two potential outcomes following the upsurge in dormant LTC. The first scenario could lead to a sell-off if these addresses are transferring coins to exchanges. Alternatively, the movement could furnish liquidity, potentially supporting a more significant rebound to $100. As of now, traders may want to exercise patience, awaiting Litecoin’s decisive movement either above $70 or below $67 to gauge the market direction.