A Sign of Uptrend Ahead?

• Litecoin has been trading in a downtrend against Bitcoin since early 2023, and despite a rally last May, the trend persisted; this trend reversed this week, and analysts predict it could signal a bull market for LTC.
•  The mean dollar invested age has dipped drastically over the past month, a trend that almost always comes before LTC embarks on a bull rally.

Litecoin has underperformed the market for the better part of the past eight months. However, over the past month, the veteran cryptocurrency has woken up to hit its highest price since last July. LTC has also reversed its one-year losing streak against Bitcoin, and with most of its technical indicators looking stronger, analysts believe an LTC bull run is coming,

Litecoin trades at $103.43 at press time, surging 3.70% in the past day, the second-highest gain among the top 25 coins after Dogecoin’s 6.02%. It’s up 17.6% in the past month, setting a high of $110.74 in that time, its highest price since July.

Analysts expect the LTC rally to continue. World of Charts, a popular pseudonymous chartist, shared on X with his 31,000 followers a chart showing Litecoin breaking a bullish pennant it has been stuck in for several days. As seen on the graph below, breaking the pattern on the upper trendline indicates a bullish trend, while breaching the support trendline indicates bears are in control. The analyst predicts a 20-25% rally.

Litecoin Sets Bullish Metrics, Flips LTC/BTC Downtrend

Litecoin’s network metrics point to an impending bull run. The first is its network transactions-to-value (NVT) ratio, which measures the market cap against the transacted volume to assess if a token is overvalued. Litecoin’s NVT ratio has dipped since Mar. 31, showing that the token is undervalued and has room for growth.

Perhaps LTC’s most bullish indicator is its ratio against Bitcoin. The LTC/BTC ratio has been on a downtrend since early last year. As seen in the graph below, this downtrend was broken briefly in May, but the upward momentum failed to hold, and the downtrend continued.

The LTC/BTC downtrend was reversed at the beginning of April and has been on a sustained uptrend since.

Litecoin’s mean dollar invested age (MDIA) has also been on a downtrend, a metric that usually precedes an upturn in prices. The MDIA is the average age of all coins on a blockchain, which is weighted by their purchase price. The last time the MDIA dipped rapidly was around August 2020, and within the next eight months, LTC set a new record high at $451.

While most technical indicators look strong, one analyst believes the most significant boost for LTC could be external. Scott Melker, known to his 958,000 followers on X as the ‘Wolf of All Streets,’ believes that while Ethereum and XRP have taken the spotlight as the next two candidates for an ETF, it could be Litecoin that gets the green light first. After all, Litecoin was molded after Bitcoin, and the SEC has already approved a Bitcoin spot ETF.

Is This Throwback Coin Next in Line For a Spot ETF Approval!? – Looking at Litecoin $LTC | The Alpha Show @litecoin @joevezz https://t.co/pxVSftQNMQ

— The Wolf Of All Streets (@scottmelker) April 3, 2024

Recommended for you: