Litecoin enters the green zone as the crypto market recovers
Litecoin trading in green today, between the $89.78 and $90 price levels, to consolidate on yesterday’s closing price of $89.73. LTC started the year trading at $70 on January 1, 2023. It moved to $80 by January 10 as the bulls took control. The crypto traded at $100.44 on February 1 for the first time in 2023.
However, market volatility has forced the asset to retest the old declines and is currently trading in the $89-$90 price range. A closer look at the daily chart will reveal the price action and the next possible move.
Litecoin price on an uptrend
LTC has formed a green candle on the price chart today, a small recovery from the bearish trend noted on the chart on April 28. However, today’s rate change is not by a wide margin as it remains a sideways trend despite the gains.
LTC trades above its 50-day and 200-day Simple Moving Averages (SMA), a short- and long-term bullish sentiment for the asset. It is Relative strength index is 48.18 in the neutral zone. The indicator also moves sideways, which reflects the sideways trend on the daily chart.
Litecoin has found strong support at the $88.25 level preventing further price decline for the asset. Other critical support levels are $65.39 and $47.5. The resistance levels are $94.35 and $103.42.
The $90 price level is a psychological resistance level that Litecoin is testing today. The coin is likely to bounce off the $88.25 resistance level to trade above the $90 price level if the bulls win. However, the sideways trend may persist in the short term.
Litecoin halving historically bullish
Litecoin is undergoing halving every four years as a fork from the original Bitcoin blockchain. The Litecoin halving event happens every 840,000 blocks and will reduce LTC miners’ rewards from 12.5 LTC to 6.25 LTC.
Blockworks reports that Litecoin historically pumps six months before the halving happens. LTC peaked at 320% gains about 45 days before each halving, then gave up most of those returns a month after the halving event.
NEWS: Litecoin halvings coincide with big price changes – but different from bitcoin.
— Blockworks (@Blockworks_) 24 April 2023
LTC ended the year after each halving, increases between 80% and 110% at its pre-halving price. Therefore, this event appears to promote positive price action for the asset. Although the halving hype usually influences price action, other macroeconomic factors, such as inflation and regulation, also influence trends.
However, halving events always lead to price volatility and uncertainty. The goal is to reduce the circulating supply of tokens and increase scarcity. Given its historical data, the halving event will happen around August 2023 and may affect Litecoin in some way.
Featured image from Pixabay and chart from Tradingview
