Is LTC On The Brink Of Crashing By 25%?

The market is certainly in a dubious space at the moment. There is a lot happening in the crypto landscape as well as in the macroeconomic space. As a result, the prices of crypto assets are simply going haywire. While yesterday seemed positive for LTC, today seems like a completely different story. Sources at Coinpedia suggest that the token is all set for a massive price drop. According to the reporting of Coinglass, the potential reason behind this slump is a formation of negative price action, along with a bearish sentiment.  

LTC is currently trading near the $127 mark and has experienced a 6% price drop in the last 24 hours. At the same time, the trading volume of the token took some hits and declined by 23%. This decline suggests that traders do not want to engage in trading LTC at the moment. This seems completely different from the previous day when the community was optimistic as SEC was at the cusp of approving a spot ETF for LTC.  

LTC Technical analysis 

Source: TradingView

Expert analysis suggests that LTC has been operating in a tight band between $95 low and $141 high since November 2023, showing somewhat bearish movement. However, regardless of the bearish momentum, the price of the coin surged by 38% in the last few days. However, details show that the market is under tremendous selling pressure as it is fearing another price drop.  

Historical data suggests that if LTC fails to break the $141 mark in the next few days, it could fall by 25% and go back to the $95 support level. Meanwhile, the 200 EMA is showing that the coin is on a slight uptrend. Therefore, it is clear that analytics are giving mixed signals. 

Mixed Metrics 

Source: Coinglass

On-chain analytics firm Coinglass suggests that intraday traders are currently betting on the bearish side of the token. The exchange liquidation map shows that the short-side bettors are over-leveraging the $141.5 level. As a result, they have built a whopping 67 million US dollars worth of short positions in the last week. However, long-side traders seemed to be staying out of the game, as they had only built $21 million worth of long positions 

Source: Coinglass

Despite the bearish outlook of the coin, it seems that long-term investors are still on the spree of accumulating the token. In the past 24 hours, around $9.41 million worth of LTC tokens have outflown out of exchanges. Therefore, it is safe to say that short-term traders are betting on the bearish momentum of the coin, while long-term players are using the slump to buy more.