Litecoin’s price is on the brink of dipping below the $60 mark, bringing it within a mere 2.4% of establishing new year-to-date lows.
The average weekly transaction volume of Litecoin whales has dwindled to $3 billion, marking the lowest point since November 2020.
With a substantial 0.73 correlation to Bitcoin, LTC’s recovery is heavily reliant on the performance of BTC.
While Litecoin’s price trajectory has, and is likely to continue, closely mirroring that of Bitcoin, its susceptibility to a decline is exacerbated by the conspicuous inactivity of its prominent whale addresses.
Litecoin Price Approaching Fresh Lows
As of the current writing, Litecoin’s price is positioned at $61, a mere 2.4% above its lowest point this year, which is at $58. It appears highly probable that the cryptocurrency is on the verge of breaching this level, potentially establishing a fresh low for 2023, with a potential test of the support line at $58 looming.
The Relative Strength Index (RSI), signifying the momentum in the case of LTC, exhibits a bearish inclination and may contribute to additional declines. This is evident as the indicator currently stands below the neutral threshold of 50.0.
However, should LTC rebound from the $58 support and successfully make its way back to retake the $63 support level, it could potentially create an opening to surpass the 50-day Exponential Moving Average (EMA), a feat that eluded it earlier in the month.
The activity of whales indicates that any potential recovery may progress at a sluggish pace.
Litecoin exhibits a notably robust correlation with Bitcoin. In recent weeks, this correlation has remained steady at approximately 0.73, rendering LTC’s price susceptible to fluctuations in BTC’s value.
Nevertheless, apart from the overarching market indicators, the absence of a September rebound in Litecoin’s price can be attributed to the diminishing engagement of whales. Despite holding only 11% of the total circulating supply, these whale addresses, responsible for transactions exceeding $100,000, wield considerable influence over the market.
The Litecoin market’s liquidity corresponds to the activity of these addresses. Conversely, a dearth of their participation results in disturbances in price action. As of the present moment, the average weekly transaction volume from these addresses has dwindled to $3.01 billion, marking its lowest point since November 2020.
This has the potential to instill caution in investors, leading to a decrease in transactions and on-chain activity, ultimately impeding the recovery of Litecoin’s price.