Litecoin (LTC) price is up 18% since dropping to $72 last Thursday. Resilient long-term investors are doubling down on their bullish positions, which appears to be driving the ongoing price rally. How much more gains can the LTC price make before another retracement?
Litecoin’s (LTC) price has outperformed the like of BTC and ETH over the past seven days. The recent industry-wide market contraction saw Litecoin’s weak hands and short-term traders exit their positions quickly while long-term loyalists doubled down.
Will the growing Litecoin network traction see LTC make more price gains in the coming weeks?
Litecoin Weak Hands Flee, But Long-Term Holders Double Down
During the turbulent start of the month, nearly half of the 1.57 million LTC short-term traders quickly closed their positions. But remarkably, on-chain data shows that Litecoin’s long-term loyalists have doubled down on their bullish positions.
The IntoTheBlock chart below shows that between June 1 and June 19, the percentage of short-term holder addresses decreased by half, from 13.5% to 9.3%. Meanwhile, long-term investor addresses increased marginally from 47.70% to 48.45% during the same period.
“Short-term Traders” refers to wallet addresses that have held their coins for less than one month. And “Long-term Holder” addresses are those that have retained their coins for more than 1 year.
The number of weak hands on the LTC network has reduced by nearly 50%, while long-term investor addresses have increased by about 2%.
For a number of reasons, an increase in the number of long-term investors has a positive impact on price. Firstly, long-term holders give provide stability. When a significant portion of the network participants holds the cryptocurrency for an extended period, it reduces the frequency of large sell-offs or sudden price drops.
This stability can attract more investors and businesses to adopt Litecoin, as they perceive it as a reliable store of value.
LTC Underlying Network Demand is Growing
In further confirmation of the bullish stance, Litecoin has witnessed a significant increase in the number of users actively deploying transactions on the network.
As LTC price jumped 18% over the past week, Litecoin’s Daily Active Users (DAU) have also increased comparably by 10%.
The chart below shows how Litecoin DAU (7d) has increased from 2.2 million on June 15 to 2.45 million addresses recorded on June 20.
In concise terms, the Active Addresses (7d) sums up the number of unique addresses that carry out transactions over a seven-day period. When it increases during a price rally, as seen above, it indicates the gains are relatively organic and not entirely driven by market speculation.
As such, Litecoin holders can anticipate more price gains in the coming weeks. And when a price retracement happens, LTC will likely form a higher support level.
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LTC Price Prediction: A Possible $100 Retest
Considering the level of confidence shown by Litecoin long-term holders and growth in underlying network demand, LTC is likely to retest $100 in the coming weeks.
But LTC must first clear the initial $85 resistance. 333,360 addresses bought 3.87 million coins at an average of $85.94. If they look to book profits, they could trigger a pullback.
However, if the bullish momentum is strong, they could double down and push LTC toward the $100 price target.
Still, the bears could seize control again if the LTC price drops unexpectedly below $75. Although, 356,870 investors that bought 5.72 million LTC at a minimum price of $75.28 could offer formidable support.
If that support level caves, LTC may decline further toward $70.
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