Litecoin recently surpassed trendline resistance, breaking key moving averages and signalling a bullish trend.
Derivatives data shows increased trading volume and open interest.
Litecoin (LTC) has recently surpassed its trendline resistance, signalling a potential breakout on the charts. At the time of writing, LTC was trading at $89.11, registering a 1%increase in the past 24 hours.
In the last three months, LTC has been trading within an ascending channel pattern. However, with the increase in the bullish sentiment, the altcoin has been able to eliminate this channel. This rally saw Litecoin break and close above crucial moving averages, including the 20, 50, and 200-day EMAs, which shows a bullish trend.
LTC has tried several times this week to break through the $89-$93 range but has been unsuccessful. A clean breakout above $93 could likely see Litecoin pointing towards the subsequent significant barrier around $100-$104. However, a breakdown of this zone may result in a pullback towards the $76 support level and further plunges to $72 if bear pressure picks up.
The RSI has given indications of slowing down the buying pressures, erasing gains and moving below the averages. A failure to overcome the RSI-based moving average in the near future may result in further consolidation of the price.
Derivatives Data Indicates Increased Trader Interest
According to Coinglass, there has been increased trading volume in Litecoin derivatives. The trading volume has increased by 76.14%, which is $1.14 billion. This shows the tradersâ increasing interest as the price of LTC is still rising.
This is accompanied by a slight rise in open interest, indicating that more traders are positioning themselves for a big move. With the long/short ratio at 0.9414, the market outlook seems to be bullish, especially when observing Binance and OKX exchanges, where major traders are eager to buy more coins, expecting the price to rise even higher.
However, market conditions, including the state of Bitcoin, are still significant. A prolonged Bitcoin bull run may also increase the possibility of Litecoin breaking through the $93 resistance and potentially rising further.
Notably, Litecoin (LTC) has registered the formation of a golden cross on its daily chart, which has brightened the mood of the cryptocurrency market. A golden cross is a technical indicator which is formed when the 50-day moving average goes above the 200-day moving average thus indicating a possible upward trend.Â
The 50-day moving average of Litecoin rose above the 200-day moving average and a positive move could be expected. Historically, such patterns have suggested a strong rise in prices. In the February 2024 time frame, a similar golden cross formed a rally to the yearly high of $112.Â
Network Metrics Reach New Highs
The Litecoin network is also still going strong, with the hashrate reaching an all-time high of 1.7 PH/s. The higher hashrate signifies better network security and mining efficiency, which indicates the support of the community. Litecoin also recorded 84 million transactions in this year alone, breaking the previous yearâs record of 2023 by 17 million.
Moreover, the balance with short-term LTC investors has increased by 31% in the last month. In the past, similar growth has often happened before the significant price appreciation, thus supporting the bullish mood around LTC.
