Litecoin: Can bulls use $80 support as a springboard for another rally?
Disclaimer: The information presented does not constitute financial, investment, trading, or other types of advice and is solely the writer’s opinion.
- Bulls look to use a familiar support level to reverse July losses.
- Mean coin age trended upwards to highlight bullish activity.
Litecoin [LTC] bounced off the $80 psychological level, as bulls looked to put a gloomy July behind them. LTC had embarked on a significant bearish slide in July that erased all of its Q2 gains.
Realistic or not, here’s LTC market cap in BTC terms
Bulls are looking to ride the market hype after Litecoin’s halving event on 2 August. Although the halving event saw a decline in its hash rate, Litecoin is banking on the growth of its mining sector to boost LTC’s price in the long term.
$80 psychological level rescues bulls again
Litecoin’s price action on the 12-hour timeframe highlighted the importance of the $80 price level to bulls. Previously, it has served as a major rallying point for LTC after periods of intense selling pressure.
A look southward showed the $80 price level sparking a bullish run in early May and late June. Bulls will be hoping for a repeat of the same after a 35% price dip in July.
The on-chart indicators flashed encouraging signs. The Moving Average Convergence Divergence (MACD) posted a bullish crossover and a few green bars above the zero mark. Similarly, the Relative Strength Index (RSI) made a notable push toward the neutral 50 mark, hinting at growing buy pressure.
However, the first obstacle in the way of bulls is the $85 resistance level. A session close above this level can see buyers target $90 – $95. On the flip side, a price rejection could see LTC fall into a range formation in the mid-term.
Upward movement of mean coin age hinted at active bulls
The chances of a bullish recovery were boosted by Litecoin’s on-chain metrics. Per Santiment, the 90-day mean coin age has been the rise since late July, showing an accumulation of LTC across the network.
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Likewise, the 30d Market Value to Realized Value (MVRV) ratio’s reading of 10% revealed that monthly holders were starting to realize profits. Together, this could enhance the chances of bulls embarking on a significant price reversal.