The price of Litecoin (LTC) has surged past the crucial resistance level of $90 over the weekend. With the growing adoption of Litecoin, will other bullish investors join in on the LTC price rally?
Despite the ongoing sell-off by Litecoin miners, the digital asset has traded above $85 for 14 consecutive days. The strong performance can be attributed to the growing adoption rate of Litecoin throughout its network, as suggested by on-chain data.
This article provides an in-depth analysis explaining why investors are bullish on the Litecoin price rally.
Litecoin Adoption Rate is on the Rise
From retail investors to large industry players, more market participants have increasingly been adopting Litecoin for their cryptocurrency transactions. As a result, LTC transaction volumes have nearly doubled since last month.
The chart below shows how the transaction volume has increased by 82% from $758.4 million on April 30th to the recent peak of $1.38 billion on May 27th.
LTC’s daily transaction volume has not reached such heights since January 17th, more than four months ago. Increased transactional activity typically results in a corresponding increase in Litecoin’s price, suggesting the potential for more price gains for LTC holders.
Litecoin Adoption Rate is Growing Faster Than Price Action
Despite Litecoin’s recent price gains, on-chain data shows that the adoption rate of Litecoin is growing at a much faster rate. While LTC’s price has increased by 4% this month, transaction volumes have surged by more than 82%.
The Network Value to Transaction Volume (NVT) ratio, which measures the relationship between a cryptocurrency’s market capitalization and transactional activity, captures this apparent undervaluation. The Litecoin NVT ratio has dropped by 35%, indicating that the asset is undervalued and could see increased demand from bullish investors.
If bullish investors buy into the positive market sentiment, Litecoin is poised for more price gains in the coming days.
In summary, the growing adoption rate and low NVT ratio could result in Litecoin’s increased demand, validating bullish LTC price predictions.
LTC Price Prediction: Bulls Aiming for $100
The overwhelming sentiment surrounding Litecoin supports the prediction that the digital asset will reach $100 in the forthcoming days.
However, IntoTheBlock’s In/Out of the Money Around Price (IOMAP) data reveals that LTC will initially face resistance around $96. This is because 170,000 investors who bought 2.15 million LTC at an average price of $96 could sell once they break even.
If the bullish momentum persists, the price could climb further towards $105, with only a handful of smaller groups holding LTC at $98, $100, and $103.
Despite the bullish Litecoin price predictions, if LTC loses the critical $90, the bears could negate the bullish trend. Nonetheless, the 280,000 investors who bought 2.26 million LTC at an average price of $90 would likely prevent such a drop. While LTC could retrace further towards $80 if that support level is breached, a massive cluster of 623,000 wallets currently holds the line at an average buy of $87, making it a considerable challenge for the bears to break through that support.
Disclaimer
This price analysis article is for informational purposes only and does not provide financial or investment advice. Bitrabo is committed to accurate and unbiased reporting, but market conditions are subject to change without notice. Always conduct thorough research and consult with a professional before making any financial decisions.
