Crypto analytics platform Santiment says Litecoin (LTC) is flashing bullish after the August 2 halving event.
In a new video strategy session, Brian Quinlivan, director of marketing at Santiment say that it appears that the peer-to-peer payment network is forming a bullish divergence as sharks and whales continue to accumulate LTC as price falls.
“I like to look at holders who have somewhere between let’s say 100 to 100,000 Litecoin. And it actually looks like they’re still kind of bulking up. So this is good to see. This was about 10 days before the halving, they held about 42.4%. They added about half a percent of the total supply to their collective wallet.
In terms of the absolute number of coins they hold, these important sharks and whales, they have 31.5 million again. This is the highest amount they have held all year. We have to go back to 2022 here, and they’re still above the line. They keep rising. This is a good sign for Litecoin.
You have the price, which goes down this way, while shark and whale holding companies do a little more [upwards] like that. That is a bullish divergence in my opinion. It does show that very long term Litecoin still has some viability to continue a bit, maybe towards the end of the year. Maybe sometime in 2024.”
Quinlivan also looks at Litecoin’s 30-day market value to realized value (MVRV), which traders use to detect overbought or oversold conditions. He says the MVRV indicates that Litecoin will likely have to fall in the near term to find a market bottom before going up again.
“Despite the drop, 30-day traders are still up about 11%, while 365-day traders are up 0.6%, which is essentially the same. So we would ideally like to see… in the long term and in the short term below this zero axis, which indicates that they are underwater…
If both are underwater at the same time, bottoms form here and it’s a good signal to jump into possession. So I think a little more cooling is needed at this point, despite the fact that since this top, since July 2, the price is down 26%, but it may drop a little more to get to the 30. daily average trading returns to the negatives and then you have a really good setup to buy at a premium or very low risk time frame.
Litecoin is trading at $82.98 at the time of writing, down 1.3% in the past 24 hours.
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