Litecoin (LTC) has experienced a significant price increase, outperforming the broader crypto market, as traders show optimism towards its upcoming halving event. The price of LTC surged by approximately 8.3% on July 2nd, reaching $116, its highest level since April 2022. This week alone, LTC’s returns climbed over 30%, making it the best-performing week for Litecoin since November 2021.
Traders have been increasingly buying Litecoin in anticipation of its halving, scheduled for August 3rd. During this event, the mining reward per block on the Litecoin network will be reduced from 12.5 LTC to 6.25 LTC, leading to a potential decrease in new supply. Analysts, such as Crypto Tony and Michael van de Poppe, predict further price rallies for Litecoin, with targets ranging from $140 to $200 around the halving event.
Historically, each Litecoin halving has been followed by a volatile price rally, indicating the possibility of a similar scenario if history repeats itself. Additionally, the recent listing of Litecoin on EDX Markets, an institutional crypto exchange backed by prominent firms like Citadel Securities, Fidelity Digital Assets, and Charles Schwab Corp, has contributed to the price surge. The filing of a Bitcoin ETF by BlackRock, which prompted other financial institutions to follow suit, has further boosted Litecoin and other crypto assets. Since the announcement of the Bitcoin ETF filing on June 15th, LTC’s price has increased by over 60%.
However, Litecoin’s daily relative strength index (RSI) was above 70 on July 2nd, suggesting an “overbought” state and raising the possibility of a correction in the coming days. In the event of a correction, a dip back to the $100 support level is likely. A decisive close below $100 could open the door for a test of its 50-day exponential moving average (50-day EMA) near $90. Conversely, a bounce from $100 would position LTC/USD for further upside.
Considering Litecoin’s strong fundamentals, there is potential for the price to rise towards the resistance level of $130, which was significant between January and April 2022. This level aligns with the upper trendline of LTC’s ongoing ascending channel trajectory.
Overall, this setup presents an opportunity for LTC bulls to achieve a potential 20% gain by late July or early August. However, it is important to note that this article does not provide investment advice, and readers should conduct their own research before making any investment or trading decisions.