Litecoin Price Analysis – Sails strong but an ill wind blows – Courageous Fresh Coin

Litecoin (LTC) is up overheen 100% since February 2nd. The market cap now stands at US$11.7 billion, with US$Two.33 billion traded overheen the past 24 hours.

LTC has consistent block times near Two.Five minutes, with very few unconfirmed transactions, and transactions vanaf day have decreased sharply recently. The network value to estimated on-chain daily transactions (NVT) ratio has therefore reached historic lows.

The NVT ratio can be used to assess the network’s relative utility overheen time, albeit NVT is difficult to compare inbetween coins which use different transaction types. The LTC NVT is among the lowest of all coins, based on available gegevens, suggesting the coin is underpriced based on its utility. Only Dogecoin (DOGE) and Cardano (ADA) have a lower NVT.

LTC hash rate has exploded overheen the past year, largely mirroring its valuation, which directly affects mining profitability. The LTC overeenstemming algorithm uses Scrypt, spil opposed to SHA256 used by Bitcoin (and some others). LTC had bot considered “ASIC-resistant” until Scrypt ASICs were developed, which permitted for the acute increase te hash rate. The next block prize halving date is due ter August 2019, at which point miners will generate 12.Five LTC vanaf block.

The creator of LTC, Charlie Lee, announced an interim roadmap on December 20th, which includes enlargening merchant processors, further wallet development, LTC adoption on a goods trading toneelpodium, and one “surprise.” The LTC core protocol developers then announced a fresh version candidate on February 8th. Highlights include fork safety enhancements and lowering the ondergrens relay toverfee.

Ter the interim, an LTC fork called Litecoin Specie (LCC) wasgoed announced on February 3rd. The project has no affiliation with the Litecoin Core developers or project. The LCC fork is scheduled for block 1371111, on or around February 18th. Every Litecoin holder will receive Ten LCC for every 1 LTC they own, providing the fresh blockchain project 10x the maximum supply. Charlie Lee quickly called the fork a scam.

The LCC fork will use SHA256 spil opposed to Scrypt, according to the webstek, spil “there is no prompt, cheap SHA256 coin with good difficulty adjustment. SHA256 miners have little practical choice of hashpower destination, and if they do mine blocks they’re being paid te a currency with Ten minute block times.” The LCC network will retarget difficulty every block using the DASH project’s DarkGravity V3 algorithm. The fresh cryptocurrency also includes SegWit support and replay attack protection, with fresh address prefixes to prevent confusion and inter-chain issues.

While news of the upcoming fork has peppered the news, more and more merchant processors have bot adopting LTC payments. A fresh verhoging for facilitating Litecoin payments, LitePay, wasgoed recently released to ease merchant adoption. One of the largest companies te the industry, Coinbase, subsequently announced a rivaling verhoging. Coinbase Commerce facilitates payments ter a range of cryptocurrencies, and benefits from being part of the extensive Coinbase ecosystem.

Litecoin exchange traded volume is led by Bitcoin (BTC), U.S. Dollar (USD), and U.S. Dollar Tether (USDT). The USD volume share is presently strongly led by GDAX suggesting fresh money is likely on-ramping directly into LTC from fiat. A Korea Won (KRW) premium persists spil news that the South Korea government is unlikely to verbod cryptocurrency trading entirely.

Technical Analysis

It’s significant to assess the status of the trend following a large pullback. This can be done with indicators including Ichimoku Cloud and Exponential Moving Averages (EMA), alongside classic chart patterns and candle structure.

Despite the 76% pullback, price remained on the bullish side of long-term support. On the weekly chart, there is a bullish reversal candle pattern, known spil a tweezer bottom. The pattern will be confirmed with a green weekly close on the following candle. A long position can always be entered when the 2nd candle does not make a lower low, but this brings more risk.

Ichimoku Cloud metrics on the daily chart, using singled settings (Ten/30/60/30) for quicker signals, are all presently bearish. However, there were several touches of the 200EMA (white) indicating a reversion to the mean. There is also an upcoming Kumo twist (near today’s date). This zone is a region with no support or resistance. If price is below the Cloud when the twist when it occurs, the twist will act spil a magnet for upward momentum.

Cloud metrics on the daily chart, using doubled settings (20/60/120/30) for more accurate signals, are also all bearish. However, a reversal wasgoed suggested by the distance of the Tenkan from the Kijun, known spil a C-clamp. Current resistance sits around US$250-US$255 based on the Kijun and the point of a previous triangle breakout to the downside.

A Pitchfork with anchor points ter June and September shows a strong bounce off of the 1.618 extension. Price has now bot rejected at the upper and lower quartile, marking this spil strong reversal zone. Price will consistently attempt to comeback to Pitchfork mean (crimson).

Cloud metrics on the four-hour chart are all bullish. Price exploded after the Kumo breakout, which also broke the diagonal resistance followiof a ‘W’ dual bottom. The 50/200EMA remains bearish but will likely cross bullish within the next few days. There is typically a pullback to the 200EMA after the bullish EMA cross, before the trend resumes upwards. Bids at the 200EMA would be an optimal entry point.

The previous triangle, which failed to hold spil support on January 15th, provides horizontal resistance around US$255 (dotted crimson below). Triangles typically pauze support or resistance when 75% total or greater, 86% te this case.

The LTC/BTC ratio has violated through multi-month resistance, making a fresh local high, after a taut consolidation pattern that is reminiscent of a bull flag. The 1.618 Fibonacci extension and measured stir, using the base of the flagpole and latest high, yield targets of 0.029BTC and 0.035BTC respectively.

Conclusion

While utility and development proceed to provide momentum, the current buying madness is likely connected to the upcoming Litecoin Contant fork, and the perceived promise of free money for investors when the blockchain launches. It is not uncommon for euphoric buying to occur pre-fork. Speculators typically hold until the blockchain forks, and will then instantly sell either coin, or both. If LCC is driving Litecoin buying, expect a swift druppel ter price following the fork.

Technicals support a strong reversal te the micro bearish trend following the 75% selloff. Price is presently near the 50% retracement of the down stir with several other points of confluence suggesting strong resistance at the current price. Further upside is likely te the near term until the LCC fork. A pullback to the four hour 200EMA will likely occur after the LCC fork. The macro trend resumes to be bullish.

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