Litecoin Price Rises 1% to $63.7 Amid Market Pullback
Despite a broader downturn in the cryptocurrency market, Litecoin’s price saw a modest 1% increase to $63.7 during U.S. trading on Tuesday. While most major altcoins struggled with a lack of momentum, leading to a temporary dip as buyers stabilized from last week’s gains, Litecoin’s rebound appears to be linked to the sudden capitulation of short-sellers, a sign that often signals a potential recovery.
Litecoin Price Poised to Test Multi-Year Support
For the past five months, Litecoin has been undergoing a steady correction, pressured by a descending trendline. This bearish trend has driven the price down from $112.8 to $63, marking a 45% drop and reducing its market capitalization to $4.77 billion.
The overhead trendline, along with the 50-day exponential moving average, has provided strong resistance against bullish efforts, reinforcing a “sell on rallies” sentiment. If bearish pressure continues, Litecoin could face a further 20% decline, potentially retesting the support trendline of a long-standing triangle pattern that has been active since December 2018.
For LTC holders, a retest of this lower trendline could be crucial. A bearish break below this level could end a multi-year consolidation phase in favor of the bears, possibly pushing the price down to a target of $40, and eventually $25.
LTC Looks for Stability as Small Investors Exit
Over the past two weeks, LTC price has remained relatively flat, hovering around the $65 mark. Despite this consolidation, the market experienced a notable liquidation event, with 45.2K Litecoin wallets holding between 0.1 to 1 LTC seeing a decrease, indicating that smaller investors are exiting their positions.
However, the exit of smaller or speculative traders is often viewed as a shakeout, which can attract long-term investors. This transition is generally considered a healthy sign for an asset, as it lays the foundation for a more stable recovery.
If the bottom support trendline holds, Litecoin could see a significant reversal. A bullish breakout above the overhead trendline would signal renewed upward momentum, potentially targeting a rise to $80.
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