Litecoin whales take position as halving countdown narrows
- Litecoin whales deliver a surprising end of June outcome.
- The whale purchase may encourage retail, but could this be a liquidity trap?
Just a week ago we looked into how Litecoin [LTC] faired, especially after a bearish performance at the end of June. We also highlighted the halving as the most significant upcoming event and why it did not yet have an impact on price.
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Fast forward to the present and a lot has changed as far as Litecoin is concerned in the last few days. Its supply distribution shows that some whale categories have been accumulating during the dip. Whales in the 10,000 to 100,000 LTC (denoted in yellow) and 1 million to 10 million LTC (denoted in purple) range have been accumulating during the last 10 days of June.
The two whale categories collectively control most of Litecoin’s circulating supply. It was worth noting that most other top whale categories have been contributing to sell pressure. Interestingly, this accumulation barely had much of an impact on price up until the last day of June. LTC’s on-chain volume registered a large spike on 30 June.
Can Litecoin bulls keep up the pace in July?
The volume surge was clearly bullish volumes because Litecoin’s price action bounced back up by about 28% on the same day. Interestingly, the bullish volume in the last few days pushed the price to a new 12-month high. LTC peaked at $114.98 during the latest surge but it traded at $107.37 at press time.
The bullish volume pushed LTC intoan overboughtt zone, but does this mean it is headed for some more downside in the next few days? Well, Litecoin’s MVRV ratio was slightly below its recent monthly peak. This means most of the recent buyers are now in profit. The mean coin age metric dipped significantly between 28 June and 1 July, confirming that a sizable amount exchanged hands after a long duration.
But what does this all mean for LTC? On one hand, the recent rally and the high MVRV ratio means those who purchased recently are already in profit. As such, there might be an incentive to cash out said profits, especially if Litecoin can attract more liquidity. On the other hand, exit liquidity might not be enough to encourage short-term profit-taking.
Just 30 days till the Litecoin Halving!!
— Litecoin (@litecoin) July 3, 2023
Read about Litcoin (LTC) price prediction for 2023/2024
The next 4 weeks are critical for Litecoin because of the upcoming halving. That event might encourage more LTC holders to hodl in anticipation of more potential profits.
Similarly, more liquidity is bound to flow into Litecoin near the halving event.