Litecoin’s attempts to establish the 50-day EMA as a reliable support level have been fruitless since the beginning of August.
At present, the significant LTC holders, who control approximately 12% of the total circulating supply, have remained passive.
The LTC whales’ average transaction volume has been dwindling and currently stands at $1.2 billion as of the latest data.
Around two weeks ago, Litecoin’s price displayed some signs of recovery, but it failed to maintain its bullish momentum, resulting in minor corrections. While broader market factors can be attributed to this setback, a significant portion of the responsibility lies with the whales, whose underwhelming performance has affected the altcoin.
Litecoin’s price has fallen short in a crucial retest.
Litecoin’s price was on the verge of breaking through not only the $69 resistance but also flipping the 50-day Exponential Moving Average (EMA). A successful retest of these levels would have solidified them as crucial support levels, paving the way to reclaim the 100- and 200-day EMAs and potentially propelling the altcoin toward $80.
However, the breach attempt failed, causing LTC to retrace and test the $63 support level. Additionally, the Relative Strength Index (RSI) remained in the bearish territory below the neutral line at 50.0. Typically, a bounce back from the neutral line when it serves as support confirms a bullish signal, but this was not reflected in the price action.
This scenario could materialize if the altcoin garners bullish support and successfully transforms the mentioned resistance level into a solid support line, thus negating the bearish outlook. Otherwise, the possibility of further decline remains on the table.
Litecoin’s significant investors, or whales, must reemerge.
Litecoin, as one of the earliest cryptocurrencies globally, undoubtedly boasts a substantial user and investor base. However, it also retains a significant portion of its circulating supply within whale addresses – those holding more than $100,000 worth of tokens in their wallets.
Presently, these whales have been involved in transactions totaling just $1.22 billion, marking the lowest recorded figure since December 2020. This decline is indeed a cause for concern, especially when considering that even the daily average transaction volume has consistently exceeded $11 billion at its lowest points.
The heightened concern surrounding their inactivity stems from the fact that these addresses collectively possess nearly 9 million LTC tokens, valued at $567 million based on current market prices. This accounts for nearly 12% of Litecoin’s total circulating supply. The resumption of significant whale activity could potentially reinvigorate the price, driving LTC closer to the $80 mark once more.