- The price of Litecoin briefly touched the $105 mark on Monday, jumping 22% from the one-month low of $87 recorded during the Dec. 20 market crash.
- Litecoin miners have maintained steady reserves over the past three days after investing 210,000 LTC between December 15th and 20th.
- Litecoin’s Volume Delta technical indicator turned positive, signaling an increase in buying momentum.
The price of Litecoin hit the 105 mark on Monday, jumping 22% from the one-month low of $87 recorded during last week’s market crash. On-chain data shows that selling pressure among LTC miners has eased. Is the bottom in?
Litecoin rebounded 22% to retake $100 territory
Hawkish statements from the Federal Reserve (Fed) of the United States (US) caused a major drop in crypto markets last week, sending Bitcoin (BTC), Ethereum (ETH) and Litecoin (LTC) into double-digit losses.
But as the dust settled over the weekend, strategic crypto traders took advantage of the price drop to enter new positions.
While BTC and ETH retook key resistance levels at $96,000 and $3,300 respectively, the price of LTC also showed early signs of an impending bullish reversal.
Litecoin Price Action | LTCUSDT (Binance)
The LTCUSDT daily chart above shows how the price of Litecoin fell to a monthly low of $87 on December 20th.
However, bull traders buying the dip dominated the LTC markets over the weekend, pushing prices up 22% to briefly reclaim $105 in the early hours of Monday.
Litecoin miners halted $200 million sales spree
Amid last week’s market decline, Litecoin emerged as one of the biggest losers, falling 34% between December 17th and 20th.
On-chain data shows that panicked miners also contributed to the accelerated decline in the price of LTC, selling off large amounts of their reserves amid the market sell-off.
Corroborating this view, IntoTheBlock’s miner reserve chart below tracks changes in miner trading activity in real-time around key market events.
Litecoin mining reserves vs. LTC price | Source: IntoTheBlock
Between December 16 and December 20, Litecoin miners sold off a significant 210,000 LTC, reducing their reserve balances from 1.54 million to 1.35 million LTC.
This reflected panic among miners, possibly fueled by a dovish statement from the US Fed during the period.
However, in the three days that followed, miners stabilized their holdings at 1.35 million LTC, signaling the end of the initial wave of panic-induced selling.
When miners stop selling during a market downturn, fewer newly minted coins enter the market’s short-term supply.
This reduction in selling pressure, along with miners holding on to their reserves, creates favorable conditions for a price recovery.
Litecoin Price Prediction: Major resistance at $115 looms
Litecoin price is back at $103 after a 22% gain, but challenges lie ahead.
The Donchian channels show that LTC remains below the ceiling at $116.88, which is in line with a key resistance level.
If the bullish momentum weakens near this threshold, it could trigger a pullback as sellers re-enter the market.
Although Volume Delta has turned positive, signaling an increase in demand, the lack of sustained volume growth raises concerns about the strength of the increase.
Without sustained buying pressure, LTC may struggle to break above the $115 resistance convincingly.
Litecoin Price Forecast | LTCUSDT (Binance)
On the downside, the first level of support is at the lower boundary of the Donchian channel at $86.69.
A break of this level could expose LTC to further losses towards the psychological level of $80.
A bearish scenario would likely materialize if market sentiment deteriorates or if miners continue selling pressure, increasing short-term supply.
