Lighter surges 11% as whale scoops up $2M LIT: Is $5 still on the cards?

It seems like Lighter [LIT] has reached its bottom. After declining for five consecutive days, Lighter is seeing a trend reversal and falling  to a low of $4.00.

Now, the upside is getting a fresh push. For that reason, LIT surged 11%, jumping back to $4.68 before retracing to $4.55 as of this writing.

The altcoin’s upside push was backed by a 52% surge in trading volume, with the volume reaching $75 million.

With the volume rising, turnover also made a strong upside move, rising to $37 million, a marking over a $9 million jump. This suggested strong buying pressure.

Lighter saw renewed demand amid growing social chatter over the CLARITY Act. For example, analyst Andy noted that Lighter is loving the CLARITY recent developments since Vlad is in the CFTC innovation advisory committee.

The market sees his regulatory involvement as advantageous for Lighter amid the likelihood of clearer rules for digital assets.

Lighter sees renewed interest from both whales and retail traders

As the altcoin signaled a trend reversal, Lighter saw  renewed demand from both whales and small-scale investors. For starters, some whales have rushed to take position, despite the ongoing upside.

According to Arkham data, an address withdrew 500,000 LIT from the Lighter protocol worth $2.07 million. With the whale scooping up amid these gains, it reflects optimism, as they anticipate there is more room for growth.

On top of that, traders have also returned to speculate. Altcoin’s Open Interest surged 13% to $512 million, while the volume for derivatives jumped 127%.

The rise in OI backed by strong volume, suggesting that traders aggressively opened new positions. A look at the Long/Short Ratio, it seems these investors mostly went long, with Binance traders leading with a ratio of 2.8.

Can the uptrend hold?

With the uptick, LIT flipped both the 9- and 21-day moving averages, reflecting short-term upside pressure.

At the same time, the Stochastic RSI formed a bullish crossover and jumped to 9. With the crossover, it suggests that buyers have started to outpace sellers.

However, at 9, the indicator warns that buyers have yet to fully retake the market. But the upward trajectory reflects changing power dynamics.

Therefore, if the demand holds, the uptrend will continue and reclaim $5. For this bullish outlook to hold, LIT must close above its short-term MA around $4.4.

Final Summary 

• LIT saw a trend reversal, surging 11%, to a local high of $4.68, then slightly retraced to $4.50. 
• A whale purchased $2.07 million in LIT amid renewed market interest over the likelihood of CLARITY passing in the US Senate.