Litecoin (LTC) has experienced a notable increase in price today, outperforming the broader cryptocurrency market, as traders maintain a bullish sentiment towards its upcoming block reward halving event scheduled for August. The price of LTC rose by approximately 8.3% on July 2, reaching $116, its highest level since April 2022. With week-to-date returns surpassing 30%, this marks Litecoin’s best week since November 2021.
Traders have been eagerly purchasing Litecoin in anticipation of the halving event on August 3. This event will result in a reduction of the Litecoin network’s mining reward per block from 12.5 LTC to 6.25 LTC, theoretically decreasing the new supply of Litecoin.
Several market analysts have shared optimistic price predictions for Litecoin ahead of the halving. Independent analyst Crypto Tony believes that Litecoin could rally towards $140, while analyst Michael van de Poppe expects the price to reach $200 around the event.
Historically, each Litecoin halving has been followed by a period of volatile price rallies, indicating the possibility of a similar scenario repeating this time. Additionally, the listing of Litecoin on EDX Markets, an institutional crypto exchange supported by companies like Citadel Securities, Fidelity Digital Assets, and Charles Schwab Corp, has contributed to the recent price rally.
Furthermore, the filing of BlackRock’s Bitcoin ETF with the SEC, which prompted other major financial institutions to follow suit, has provided a boost to Litecoin and other crypto assets. Since the announcement on June 15, the price of LTC has surged over 60%.
The recent surge in buying activity has resulted in an “overbought” state for Litecoin. The daily relative strength index (RSI) for LTC was above 70 on July 2, suggesting the possibility of a correction in the coming days. In such a scenario, the price of LTC could test the key support level of $100. A decisive close below $100 may lead to a further test of the 50-day exponential moving average (50-day EMA) around $90.
Conversely, if LTC bounces back from the $100 support level, it could position itself for further upside movement. Supported by strong fundamentals, Litecoin could potentially rise towards the resistance level of $130, which was observed from January to April 2022. This level also aligns with the upper trendline of LTC’s ongoing ascending channel trajectory, as depicted in the weekly chart.
Based on this setup, LTC bulls have the potential to achieve a 20% gain by late July or early August, given the favorable conditions and positive market outlook.
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