In a trading environment where bearish outlooks take center stage, leading to massive liquidations of the asset on an hourly basis, Litecoin (LTC) is attracting attention for all the right reasons. Litecoin flashes promising signs as traders prepare for another wave of selling pressure ahead of tomorrow's highly anticipated court approval that will allow FTX to sell $3.4 billion of its cryptocurrency holdings. LTC price signals a potential bullish reversal on the back of encouraging on-chain data.
Long-term Litecoin holders gain confidence
The altcoin market is currently facing fears of a massive sell-off starting tomorrow if FTX gets court approval to liquidate its cryptocurrency reserves. However, LTC price has been on a recovery trend after falling below the key support level of $60.
As data from IntoTheBlock shows, the health and demand for the LTC token has been bullish. Long-term holders are bullish on Litecoin’s future trajectory as addresses holding it for more than a year have hit an all-time high. The metric has grown exponentially since June and now touches the 5.02 million mark.
Since Litecoin’s 2023 peak price of $114.5 on July 2, the number of addresses has increased by 602,000. Litecoin holdings at these addresses also increased by 3.2 million LTC during the same time frame.
This shows that a large number of current network users remain confident in Litecoin’s long-term potential, even as the price drops.
Additionally, whales with Litecoin balances between 10,000 and 100 million LTC are also showing signs of optimism. According to Santiment data, these large holders paused their week-long selling spree and bought 40,000 LTC amid the price decline over the past two days. At the current price of around $60 per coin, these new purchases are worth an estimated $2.4 million.
What’s next for LTC price?
Litecoin price has bounced back in the past few hours as buyers created buying sentiment on the drop near $57. LTC price surged towards the 20-day exponential moving average (EMA) at $60.8 but failed to break above, indicating strong resistance at this level for bearish traders. At the time of writing, LTC price is trading at $60.48, up more than 1.8% from yesterday.
As the bears failed to break through the key support level at $53, this suggests that selling pressure is waning at these lower prices. The Relative Strength Index (RSI) appears to be forming a positive divergence near its midline, indicating that selling momentum is waning.
A key bullish indicator would be a successful breakout and close above the 20-day EMA, paving the way for a stronger rally towards $65. Further gains could push the price towards $76.
Conversely, if the $53 support is broken, LTC price may enter a downward trajectory. In this case, we could see a drop to the key $47 level.