Crypto analytics platform Santiment says that Litecoin (LTC) is flashing bullish after its August 2nd halving event.
In a new video strategy session, Santiment’s director of marketing Brian Quinlivan says that it appears the peer-to-peer payments network is forming a bullish divergence as sharks and whales continue to accumulate LTC as price dips.
“I like looking at holders that have anywhere between, let’s say 100 all the way to 100,000 Litecoin. And it actually looks like they’re still accumulating a bit. So this is decent to see. This was about 10 days before the halving, they were holding about 42.4%. They’ve added about a half percentage of the entire supply to their collective wallets.
In terms of the absolute amount of coins that they hold, these key sharks and whales, they are back up to holding 31.5 million. This is the highest amount that they’ve held all year long. We’ve got to go back to 2022 here, and they’re still above the line. They’re continuing to go up. This is a good sign for Litecoin.
You’ve got the price, kind of moving down like this, while shark and whale holdings are doing something more [upwards] like that. That’s a bullish divergence in my opinion. It does show that on the very long-term scale, Litecoin does still have some viability to go on a bit of a run, maybe by 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 that the MVRV indicates Litecoin will likely need to dip in the near term to find a market bottom, before making a bounce to the upside.
“Despite the decline, 30-day traders are still up about 11% or so, while 365-day traders are up 0.6%, which is essentially even. So, we would ideally like to see… long-term and the short-term under this zero axis indicating they are underwater…
When they’re both underwater at the same time, this is where bottoms form and it’s a good signal to jump into the asset. So I think that right now there still needs to be a little more cooling off, despite the fact that since this top, since July 2nd price has dropped 26%, but it may have a little more dropping to do just to get the 30-day average trading returns down into the negatives and then you’ve got a really good setup to buy at a premium or a very low risky timeframe.”
Litecoin is trading for $82.98 at time of writing, down 1.3% in the last 24 hours.
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