- Whale activity around Litecoin remains heightened, with significant accumulation observed post the third halving.
- Market indicators, including MVRV Z Score and aSORP, suggest Litecoin might be touching its market bottom.
The Rise of Litecoin Holders: A Precursor to a Trend?
Post Litecoin’s third blockchain halving, a prominent uptick in coin accumulation has been observed. A month following this significant event, investor behavior indicates heightened expectations of LTC registering bullish price movement, driven by increased accumulation.
Crypto analyst, VICKADO, cited data from IntoTheBlock in a tweet, highlighting a surge in Litecoin’s address balances in recent days, a clear testament to the prevailing buying sentiment. Moreover, the blockchain witnessed a staggering 360% rise in holder inflow over the past month. Furthermore, with the number of long-term Litecoin holders crossing the 5 million mark, their faith in the cryptocurrency seems unwavering.
$LTC inflow is drastically increasing, that means more accumulation is ongoing.
I'm hoping on this one to avoid missing out.
Thank you so much for the great analytical tool, @intotheblock. pic.twitter.com/e46RpWJYdt
— VICKADO | Crypto & Designs👨💻 (@VictorIwuegbu) September 10, 2023
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Interestingly, this accumulation trend gained momentum after the halving event, with investors anticipating a favorable LTC price trajectory in upcoming months. Adding to this, the heightened whale activity around LTC implies that major players might also be hedging their bets.
Litecoin’s Market Bottom: Fact or Fiction?
Despite buoyant investor expectations, Litecoin‘s market performance paints a different picture. As per CoinMarketCap, LTC’s value dipped over 5% in the previous week, and currently trades at $59.68, boasting a market cap surpassing $4.3 billion. This dissonance between investor sentiment and market reality raises an important question: Is Litecoin approaching its market bottom?
Several indicators suggest so. LTC’s MVRV Z Score, which discerns if Litecoin is over or undervalued concerning its “fair value”, reveals that the cryptocurrency might be undervalued. When market values substantially trail realized values, it often signals market bottoms. Current data shows LTC’s MVRV Z Score positioned below the green zone, potentially alluding to a market bottom.
Similarly, the aSORP metric for LTC, which stands at 0.97, indicates investors might be offloading their assets at a loss, another potential market bottom sign amidst a bear market.
Market Sentiment: A Mixed Bag
Contrarily, even with these bullish indicators, the broader market showcases mixed sentiment. Data from LunarCrush reveals a near 100% surge in both bullish and bearish sentiments for LTC over the past week. Additionally, LTC’s rising Altrank, generally a bearish indicator, adds to the uncertainty.
Given these mixed signals, it’s imperative for Litecoin investors to exercise caution, thoroughly analyzing both on-chain metrics and prevailing market sentiments before making investment decisions.
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