- After a brief correction, LTC climbed marginally over a 24-hour period
- Market indicators looked bearish while the mining sector thrived
After climbing close to the $80-mark, Litecoin [LTC] registered a price correction, one which can be attributed to the bearish market. While that happened, should investors believe that Litecoin is actually undervalued even after the price correction?
Is Litecoin undervalued?
For Litecoin, the previous week was difficult as it saw a major drop in price on the charts. According to CoinMarketCap, LTC’s daily chart was green, with the crypto appreciating by 1.5% in 24 hours. At the time of writing, it was trading at $73.16 with a market capitalization of over $5.4 billion.
Considering the ongoing price correction, should investors expect LTC to be undervalued? To assess the same, AMBCrypto dug deeper and checked LTC’s reserve risk. For starters, when confidence is low and price is high, then risk or reward is unattractive at that time (reserve risk is high). As per the same, Litecoin’s reserve risk registered an uptick on the charts – A sign that it was overvalued.
Source: Glassnode
On the contrary, Shan Belew, a popular Litecoin analyst, suggested that LTC was undervalued. According to him, as long as LTC’s price remains under the white lines (as visible in the tweet), LTC will remain undervalued.
Litecoin under the white lines is undervalued. pic.twitter.com/RrFx9gUgpD
— Shan Belew Ⓜ️? (@MASTERBTCLTC) December 11, 2023
What to expect going forward
AMBCrypto also took a look at LTC’s social metrics to better understand investor sentiments. As per the same, LTC’s popularity dropped, as is evident from the decline in its social volume. Its weighted sentiment also sank last week, meaning that negative sentiments dominated the market.
Source: Santiment
We then had a look at the blockchain’s daily chart to see what investors might expect from LTC and have a better understanding of whether LTC is undervalued or not.
At press time, Litecoin’s MACD projected the possibility of a bearish crossover in the near term. Both LTC’s Money Flow Index (MFI) and Chaikin Money Low (CMF) registered downticks, increasing the chances of a price drop in the days to come.
Source: TradingView
How much are 1,10,100 LTCs worth today
A thriving mining industry
With the crypto’s price was in the grip of a bout of volatility, its mining industry grew. This is evidenced by the fact that its hashrate registered an uptick after a downtrend on 4 December.
At press time, LTC’s hashrate stood at 859.48 TH/s. Like the hashrate, Coinwarz’s data revealed that Litecoin’s mining difficulty also remained relatively high, with the same flashing a reading of 28.62 M.
Source: Coinwarz
