Litecoin Price Prediction: LTC Hits $97M Roadblock After $65 Breakout
thecryptobasic.com 20 August 2024 16:22, UTC Litecoin price hit a 14-day peak of $68 on Aug 18, reflecting a 37% rebound since the monthly time frame lows recorded on Aug 5. On-chain data trends signal early profit-taking moves; how will LTC react in the week ahead?
Litecoin Breaches $65 Resistance.
Over the past two weeks, Litecoin has emerged as the stand-out performer among top-20 ranked crypto assets. The recent legalization of crypto mining in Russia appears to be one of the major catalysts behind the LTC rally.
Since the announcement of Russia’s new legislation on crypto mining, investor sentiment around Proof-of-Work coins like LTC has improved significantly. The shaded area in the chart above shows how LTC prices have surged over the last 14 days, dating back to the major market crash on Aug 5. As of Aug 19, LTC is trading above the $65 mark, reflecting a 37.65% increase.
Notably, within that period, Litecoin has outperformed major Proof of Stake coins like Ethereum and Solana, confirming the outlook that improved international regulatory stance around crypto mining has increased market demand for PoW coins like Litecoin. However, having established a steady support base above the $65 area, Litecoin’s price now faces a major roadblock that could potentially prevent the rally from entering the next phase.
Short-term Traders Looking to Book Early Profits on $97M Worth of LTC
Following the breach of the $65 resistance, the number of sell orders has risen, hinting at a potential nullification of the bullish sentiment. This suggests that after weeks of outperforming the market, short-term traders who bought LTC during the market crash around Aug 5 are now looking to cash in on some of their profits.
The Exchange Market Depth metric aggregates Litecoin orders across various crypto exchanges, providing a comprehensive view of market demand and supply.
According to the Exchange Market Depth data, the total Litecoin buy orders amount to 1,394,380 LTC, while the total sell orders amount to 1,448,100 LTC. At the average bid price of $66.93, the value of buy orders is approximately $93.3 million. Conversely, the sell orders, valued at the average ask price of $66.96, amount to about $96.96 million. The difference between the total value of buy orders and sell orders is -$3.64 million, indicating that sell orders exceed buy orders in value.
This imbalance in market demand and supply dynamics points to a bearish outlook. The significant volume of sell orders, especially from bears who were in control just days ago, could obstruct Litecoin from advancing further. The shortfall in demand may lead to a price correction phase as the week unfolds.
LTC Price Forecast: Major Roadblock at $70
Looking ahead, Litecoin faces a critical resistance level at $70. The Ichimoku Cloud and the RSI Divergence Indicator suggest a bearish outlook in the short term. The Ichimoku Cloud, often used to identify trends and reversals, shows resistance around the $70 mark, coinciding with the upper boundary of the cloud. This suggests that Litecoin may struggle to break above this level in the near term.
Furthermore, the RSI Divergence Indicator, which measures the strength of price movements, is currently at 53.06, indicating a potential slowdown in upward momentum. This bearish divergence reinforces the likelihood of a pullback, especially if the sell orders continue to outweigh buy orders.
If Litecoin fails to break above the $70 resistance, it could retrace to the $63.49 support level. A break below this level could see Litecoin retest the $60 support zone. Conversely, a successful breach of the $70 resistance could open the door for a rally toward the $75-$80 range. However, given the current market conditions and the imbalance in the order book, the odds are leaning toward a bearish correction.
