Litecoin’s (LTC) price is down today, mirroring downside moves elsewhere in the cryptocurrency market.
LTC price fell over 1.5% on Aug. 16 to around $78.25, underperforming the rest of the crypto market, which dropped 0.65% in the same period. The downside move came as a part of a broader pullback trend that started in early July.
Litecoin halving becomes “sell the news”
The crypto market decline coincided with the U.S. dollar index’s (DXY) recovery, as Cointelegraph discussed here.
However, Litecoin’s correction started a week earlier than the crypto market’s, driven by its overbought relative strength index (RSI) and a drying buying sentiment in the days leading up to its “halving” on Aug. 2.
LTC price has dropped over 30% since the day its RSI crossed the overbought threshold reading of 70. Meanwhile, when measured from the halving day, the price is down 16.45% — hinting at a “sell the news” scenario extending into Aug. 16’s bearish session.
LTC ‘hodling’ sentiment strong through selloff
Data tracking addresses that have held Litecoin for more than 155 days — aka “hodlers” — show a persistent accumulation sentiment.
Notably, the monthly Hodler Net Position Change metric flipped from negative to positive on July 23 and has remained the same ever since. In other words, Litecoin’s most loyal investors have accumulated LTC tokens ahead and after halving, displaying their bullishness toward its market.
However, Litecoin’s richest investors — or whales — appear to be at the forefront of the ongoing LTC selloff, according to Santiment data.
For instance, the Litecoin supply held by addresses with a 1 million to 10 million LTC balance has declined by 0.5% since the having. Similarly, the 100,000-1 million LTC supply cohort has dropped 1% in the same period.
A typical post-halving selloff?
Independent market analysts Rekt Capital highlights the ongoing Litecoin selloff as a typical event that succeeds the coin’s halving. But eventually, the price discovers a so-called “accumulation range” and follows it up with a sharp rebound to establish a new record high.
Historically, LTC has retraced between -73% and -83% after its Halving event to form a new Accumulation Range (black),” argued Rekt Capital, adding:
“Thus far, LTC has retraced [by up to] -31% after its most recent Halving.”
In other words, if the historic cycle repeats, Litecoin will fall toward $40 in the coming months, down about 50% from the current price levels.
Litecoin price prediction in Q3/2023
Technicals, however, are slightly more upbeat for LTC price. Currently, Litecoin’s price trends lower inside a falling wedge pattern, raising the prospects of a bullish reversal in the coming days or weeks.
Related: SEC delays set deadlines for Bitcoin ETF approval to early 2024
Falling wedges form when the price fluctuates inside a range defined by two descending, converging trendlines. They resolve after the price breaks out of the range to the upside and rises toward the level at height equal to the maximum distance between the two trendlines.
As of Aug. 16, LTC price was eyeing a breakout above the wedge’s upper trendline. Depending on the breakout point, LTC/USD can rise to anywhere between $83.25 and $95.75 by October, up 6% and 20%, respectively, from the current price levels.
This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.
Be the first to comment