Litecoin (LTC) price’s uptrend hit a temporary pause at $72 after a commendable rally from October’s support at $60. A pre-halving rally propelled LTC to highs at $115, but the crypto winter soon caught up with the coin which appears to have erased all the gains year-to-date.
The Bitcoin fork, with a market value of $5 billion and ranking 17th among other cryptos, has recorded an 83.46% drop from its all-time high of $410 but still sustains an overall 5,800% premium above its all-time low of $1.15.
Litecoin Price Technical Update As Dorman LTC Move
Litecoin price hit a setback on Thursday after sustaining an impressive rally for more than a week. Support at $70 (now resistance) was expected to absorb the selling pressure, but overwhelmed the bulls at this price point, resulting in a larger dip to $66.
While Litecoin has recovered to trade at $67.67 on Friday, the momentum behind the coin has greatly decreased. This implies that if the immediate support at $67 is overwhelmed, LTC could swipe lower in search of fresh liquidity before starting to regain the ground again.
The Directional Movement Index (DMI) is approaching a crucial junction that might determine whether declines will continue or the uptrend will resume in the short term.
Traders intending to short LTC may want to ensure that the +DI line in blue has successfully crossed beneath the negative -DI line in red before activating their sell orders. On the other hand, fresh long entries in LTC must confirm that the +DI line holds above the -DI line while moving away from each other.
The fact that the 100 Exponential Moving Average (EMA) (blue) holds above the long-term 200 EMA (purple) indicates that bulls still have the upper hand despite the correction. Hence, traders should consider giving Litecoin time to resolve the situation at hand before making up their minds to lock in the gains.
Movement below the immediate support at $67 could see Litecoin retest the next support area at $66. However, if declines intensify bears might extend their gaze to $64 and the lowest support in October at $60.
Dorman LTC See A Huge Spike
Blockchain data analytics platform Santiment’s latest insights into the scenes behind the Litecoin network revealed a significant increase in protocol activity. Addresses actively interacting on the blockchain saw a sharp spike to 319k as crypto prices surged over the last week.
Whale transactions also a saw significant jump back to levels seen last in June. Of more importance was the shift in previously dormant LTC. When dormant coins move, it is a sign of “more coins beginning to circulate,” and this results in increased volatility.
⚡️ #Litecoin saw rapidly rising #onchain movement to end the work week, with address activity and whales both hitting levels last seen in June. Additionally, dormant $LTC suddenly had a big spike, usually indicative of more coins beginning to circulate. https://t.co/ILZua1tEzV pic.twitter.com/MT1MZ2K15i
— Santiment (@santimentfeed) October 27, 2023
Therefore, two scenarios are likely to follow the spike in dormant LTC. The first could trigger a sell-off if these addresses are moving coins to exchanges, secondly, the shift could provide liquidity to support a much larger rebound to $100. For now, traders should consider exercising patience until Litecoin resolves the stalemate with action above $70 or declines below $67.
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