- LTC’s recent gains could be hampered by big investor sell-offs
- On-chain data showed strong support at $61.27, and could be key to overcoming overhead resistance
Although Litecoins [LTC] Although the price has been able to recover some of its losses, the company faces a tough challenge. AMBCrypto discovered this after analyzing the altcoin’s Large Holders Netflow.
This week, the price of Litecoin couldn’t help but fall like the rest of the market. On July 5, the value of the cryptocurrency plummeted to $57.55. However, the last 24 hours saw a 7.05% increase as LTC changed hands to $62.50.
Litecoin hotshots are leaving the coin
However, despite the rise, it is uncertain whether the cryptocurrency will continue its latest leap. In fact, according to data from IntoTheBlock, at the time of writing, Large Holders Netflow was down 95.84% over the past seven days.
Simply put, the metric is the difference between the inflow of large holders and the outflow of large holders. For context, major holders are addresses that control at least 0.1% to 1% of the total circulating supply.
When the net flow is positive, large investors accumulate more than they sell. On the contrary, if it is negative, it means that these holders are selling more than buying. This is also the case with LTC.
Source: IntoTheBlock
Should the metric remain negative, Litecoin’s upward trend could be halted. However, if inflows start to exceed outflows, the value could trade above $60 in the near term, potentially moving closer to $70.
That being said, AMBCrypto deemed it necessary to evaluate other data sets to understand the potential direction of LTC. To do this, we evaluated the altcoin’s Investor Capitalization.
The price of LTC is close to the bottom and could trade higher
This statistic is the difference between Realized Cap and Thermocap. The result of this calculation indicates whether the coin has hit the top or whether the bottom is inside.
If Investor Capitalization spikes, it suggests the coin is close to the top of this cycle. However, if the value is low, it means that the price is close to the bottom.
According to Glassnode, the metric was at an all-time low, indicating that LTC may be undervalued.
Source: Glassnode
Turning to the short-term outlook, AMBCrypto next looked at the In/Out of Money Around Price (IOMAP) indicator. The IOMAP groups focus on those who make a profit and those who suffer a loss, depending on their average accumulation price.
As a result, the metric acts as support or resistance. The larger the cluster of addresses within a price range, the stronger the support or resistance.
At the time of writing, the data showed that 128,140 addresses purchased 485,190 LTC at an average price of $63.39. This cohort ran out of money. On the other hand, 135,090 addresses purchased 1.51 million LTC for approximately $61.27. This cohort was in the money.
Since there was a higher number of addresses at a lower value, this suggested that Litecoin has strong support on the charts. Given this position, there is a good chance that Litecoin would reverse the resistance at $63.39.
Source: IntoTheBlock
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If this happens, LTC could reach $65.35 in a few days. However, this prediction could be invalidated if large holders of the coin continue to sell.
If this is the case, LTC could fall back below $60.