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Litecoin user count grows amidst a freefall in prices – What now?

3min Read

Litecoin previously saw a surge in users twice in December, followed by a sustained rally. Will the same follow this time around?

Litecoin witnesses another surge in daily active addresses, but...
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  •  Litecoin saw the daily active addresses count rise spectacularly.
  • The massive market wide bloodbath wiped out LTC’s gains from the second half of December.

Litecoin [LTC] has witnessed another surge in its daily active addresses. A Santiment post on X (formerly Twitter) highlighted this development.

The post noted that such a rise could lead to an increased market cap, which is another way to say that prices would appreciate.

This is because of the increased utility of the token and the uptick in demand for it. Litecoin has seen a surge in this metric twice in December, and each was followed by a sustained rally. Could history repeat itself?

Examining the swell in daily active addresses 

Generally, a single metric does not give a good picture of the state of the market. A combination of metrics do a better job.

Therefore, AMBCrypto looked at the social sentiment and the MVRV ratio alongside the active addresses.

Before drawing inferences from the metrics, the prior active user count spikes must be examined. The first occurred on 14th November, but this was after LTC reached a local top at the $76.8 mark.

The next two surges of the metric occurred on 6th December and 20th December. The former saw a 9% price increase within three days, and the latter witnessed a similar return over a week.

When the metric climbed again in January, it was met with a massive tumble in Litecoin prices.

Litecoin witnesses another surge in daily active addresses, but...

Source: Santiment

The MVRV ratio fell below 0 on 3rd January after the large price dump. The weighted sentiment has also largely been in the negative territory since mid-December.

This suggested a general lack of faith in the idea of a Litecoin rally. Yet, it is also possible that Litecoin prices could form a range and accumulate before pushing higher.

 Where are LTC prices headed next 

AMBCrypto noted this in the supply distribution by balance of addresses chart. The chart showed a strong uptrend in the balances of addresses holding less than 10k LTC.

Litecoin witnesses another surge in daily active addresses, but...

Source: Santiment

On the contrary, the number of addresses with 10k or greater LTC was in decline. This was an interesting finding. The downtrend has been prevalent since 2022.

However the August 2023 halving saw isolated periods of accumulation from January 2023 to March 2023. Another period of whale accumulation occurred in June of that year.

Therefore, this whale downtrend suggested that the price action of Litecoin might not be explosively bullish in the coming months.

Litecoin witnesses another surge in daily active addresses, but...

Source: LTC/USDT on TradingView

The 12-hour price chart showed a bearish market structure after the drop below $71.41. Moreover, the H4 bullish order block (cyan box) below the $68 area has been breached. The bulls have some faint hope despite this.


Read Litecoin’s [LTC] Price Prediction 2023-24


The 78.6% Fibonacci retracement level saw a candlewick go to $58 but not a 12-hour trading session close below it. Until such a session close occurs on the H12 or H4 charts, the bulls could have a say in the fight.

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Akashnath S is a Senior Journalist and Technical Analysis expert at AMBCrypto. He specializes in dissecting price action, identifying key market trends through advanced chart patterns, and forecasting both short-term and long-term asset trajectories. His distinct analytical method is grounded in his academic training as a Chemical Engineer. This background provides him with a systematic, process-oriented approach to market data, enabling him to analyze the complex dynamics of financial markets with precision and objectivity. Having actively covered the cryptocurrency space since the landmark 2017 market cycle, Akashnath possesses years of experience navigating both bull and bear markets. This seasoned perspective is critical to his insightful reporting on market volatility and evolution. As an active market participant, Akashnath enhances his analysis with crucial, hands-on experience. This practical application of his technical skills ensures his insights are not merely theoretical, but are also relevant and actionable for an audience looking to understand and navigate trading opportunities. He is dedicated to educating readers on the nuances of technical analysis, empowering them with the knowledge to make more informed financial decisions.
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