The market seems to be retracing again, with most altcoins down by over 10%. One of the cryptos that have retraced heavily is Litecoin (LTC). After recording massive gains in late March and early this month, Litecoin (LTC) seems to have hit a peak at $97. However, while this price could have been a signal to the possible start to a bull market, Litecoin needed to hold above the weekly 100-day MA at $86 for this hold true. This hasn’t been the case, and Litecoin has been on a downward spiral for the past few days. In fact, it has now retraced below the 100-day MA at $86. In essence, this could be an indicator that the run up to $97 was a bull trap and that Litecoin could be headed much lower in the short-term. In a scenario where the market continues tumbling downwards, then chances are that, Litecoin (LTC) could drop to $43, which is its next key support level on the weekly 200-day MA. Such a drop could be given impetus by Bitcoin’s price action. If Bitcoin (BTC) fails to hold above $5000, then it could drop with major resistance only available at around $4200. Such downward pressure would impact on all altcoins including Litecoin (LTC).
However, such correction would possibly be short-term. As long as Litecoin holds above $43, there is a high probability that it could be headed for a major bull run towards the end of this quarter. Reason? The upcoming Litecoin halving. This is one of the most anticipated events in crypto this year, and as it approaches, investors will be looking to bet heavy on Litecoin (LTC). That’s because, it will have an impact on the supply of this coin, and this is likely to push up its demand.
In fact, based on this event, any significant drop in the price of Litecoin (LTC) could see it rise much higher as the halving approaches. That’s because, the cheaper it appears to be, the more people are likely to FOMO, in anticipation of major gains. A testament to this was Litecoin’s drop that saw it break the weekly 200-day MA, and test a low of $21. It then rose again so fast and did close to 5X gains in slightly over a month. As such, if it approaches the halving at a price below $50, the perception will be that it is cheap, and this could see FOMO easily take it to over $200.
In essence from an investor standpoint, Litecoin’s price drop could be a blessing in disguise. It presents a buying opportunity into this crypto ahead of the halving, and the eventual crypto bull run. Litecoin (LTC) is one of the most adopted cryptos in the market, and has a very high network effect. It’s one of those cryptos that you can be sure aren’t going anywhere unless the crypto market comes to an abrupt end, and that’s highly unlikely to happen. That’s because, different countries are putting in place regulations that support the market. They won’t be doing this if crypto doesn’t have a future.