Litecoin Faces Declining Volume and Price Post-Halving
Following the Litecoin halving in August, the price of LTC experienced a significant increase, attracting renewed interest from investors. However, the subsequent halving event resulted in a “buy the rumor, sell the news” scenario, causing a downward spiral for the token. Unfortunately, this trend may not be over.
Slumping Trading Volume
Contrary to expectations, the Litecoin trading volume has been declining since the completion of the halving. Investors anticipated an increase in demand for the LTC token due to the reduced supply rate, but the opposite has occurred. Daily trading volume for the cryptocurrency has continued to slump.
In the past day alone, Litecoin’s daily trading volume dropped by 23%, reaching a meager $255 million. This figure is significantly lower compared to the $500 million daily volumes observed leading up to the halving event.
According to CoinMarketCap, LTC daily volumes drop 23%. (source)
Significant Price Plunge
In addition to the declining trading volume, the price of LTC has also experienced a substantial plunge. From its peak of $112 before the halving, the altcoin has dropped over 50% and currently hovers just above $60. Consequently, all the gains accumulated between June and July 2023 have been wiped out within a month after the halving.
Rather than acting as a bullish event as initially expected, the halving has proven to be bearish for Litecoin, particularly given its occurrence during a bear market. LTC has fallen rapidly alongside major assets like Bitcoin and Ethereum.
LTC price returns to pre-halving levels. (source)
Potential Further Decline to $50
Based on current trends, the forecast for LTC price is not promising. While Litecoin experienced a 3% increase in the past day due to Bitcoin’s recovery, this growth is unlikely to be sustained.
One indicator of the potential further decline is the falling daily trading volume, which suggests a waning interest in the asset. As investors shift their focus to other assets they deem more promising, the LTC price is likely to be affected, potentially triggering more downside movement. Additionally, the coin’s price is currently below its 50-day and 100-day moving averages, signaling a recipe for disaster.
If LTC bulls fail to maintain support above $60 and the price falls similar to September 11, a landing point of $50 becomes highly possible. This decline would bring the price back to November 2022 levels and indicate a prolonged bear trend for the digital asset.
At the time of writing, LTC price remains above $62, but the battle between bulls and bears continues.
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