The price of Litecoin has come under intense pressure in recent weeks, hovering around its lowest level this year due to poor on-chain metrics and a lackluster market. The LTC price is down 5.55% in the past week and 33% in the last three months. Additionally, the asset has tumbled 12% year-to-date, but remains 22% higher on the previous year. Litecoin has a total market capitalization of $4.5 billion, ranking it 15thu after Polkadot.
What about LTC?
Litecoin price has been on a strong downward trajectory since the successful third halving event was completed in early August. The digital asset has fallen off the radar of crypto investors since then, mainly due to the drop in price that it experienced after heavy profit-taking by investors who had invested in Litecoin, leading to a price surge fueled by market expectations around half fact.
On-chain data shows that daily transaction numbers for Litecoin have steadily declined since its August halving event. According BitInfoCharts, the number of daily LTC trades dropped from over 584,000 in May to 104,000 trades in October. This indicates a lack of interest from investors, causing a decrease in risk appetite.
Litecoin, the silver to Bitcoin’s gold, has always had a high correlation with Bitcoin, making it vulnerable to volatility in the main cryptocurrency. Beyond its correlation to Bitcoin and broader market cues, the altcoin is vulnerable to a price drop due to the inactivity of its whale addresses. Despite the fact that whale addresses control about 11% of the total supply in circulation, their buying and selling activity activates the market.
Even so, data from Coinmarketcap shows an improvement in the asset’s daily trading volume. At the time of writing, total LTC trading volume in the last 24 hours has increased by nearly 14%, indicating the possibility of a price reversal.
Litecoin Price Technical Analysis
The daily chart shows that the price of Litecoin has been range-bound in recent days, trading between the narrow range of $61 and $65. The altcoin is down more than 45% from its year-to-date high of $114 in July. Litecoin has failed to recover above the important $72.65 level since the halving event.
LTC remains below the 50-day and 200-day exponential moving averages, as well as the 50-day and 100-day simple moving averages. The relative strength indicator has fallen below the signal line, indicating increasing selling pressure. The Moving Average Convergence Divergence (MACD) indicator signals a “strong sell”.
Therefore, the price of Litecoin is likely to continue to fall in the coming sessions as it tracks the immediate and critical support level at $60. A drop below this level could push the price lower to this year’s low of $56. On the other hand, a breach above the 50-day EMA at $65.90 could trigger a price reversal, leading to subsequent gains at $72.65 and $84.