With strong support at $100 and bullish indicators flashing, LTC could be gearing up for gains | Credit: Hameem Sarwar
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Key Takeaways
The MVRV ratio shows that Litecoin is in an undervalued zone that could help sustain the uptrend.
The Supertrend validates the support, indicating that LTC’s price might break the overhead resistance.
If validated, this analysis reveals that Litecoin is ready for a notable breakout above the hurdle ahead.
Between Jan. 31 and Feb. 4, the price of Litecoin (LTC) dropped from $130 to $101. However, as soon as the price attempted to decline again, it bounced to $106 due to support at $100.
After successfully defending this key support, technical indicators reveal that Litecoin’s price might soon break above a certain resistance. Can LTC finally clear this hurdle and open the door for further gains?
MVRV compares an asset’s market capitalization to its realized capitalization. This ratio helps determine whether a cryptocurrency trades above or below its fair value.
When MVRV is high, it suggests that holders have significant unrealized gains, increasing the likelihood of profit-taking. On the other hand, a low or negative MVRV indicates that many holders are at a loss, potentially indicating an undervalued asset and a buying opportunity.
During the period LTC price dropped, the 30-day MVRV ratio attempted to drop to the negative region. However, as the price hit $100, the metric’s reading bounced and is now 5.20%.
This rebound reinforces the idea that the $100 level strongly supports Litecoin. Historically, when this scenario plays out, the MVRV ratio tends to surge above 10% and even 50%, coinciding with a higher Litecoin price.
The daily chart also seems to agree with a higher value for LTC. As shown below, bulls have defended the support at $100.
Furthermore, the green line of the Supertrend is below the coin’s price. This indicates that Litecoin’s uptrend might continue. Assuming the red segment of the indicator was above the price, it would have indicated a downtrend.
With the support at $100 and the LTC positioned in an uptrend, the next target could be to break the resistance at $137.
In addition, the 4-hour chart validates the thesis that Litecoin’s price might trade higher. This is because of the position of the Parabolic Stop And Reverse (SAR) indicator.
The Parabolic SAR is a technical indicator that determines the price direction of an asset. When the dots are above the price, it indicates resistance and shows that the price can retrace.
But in this case, the LTC price is above the dots of the Parabolic SAR. If this trend continues and buying pressure increases, the cryptocurrency’s value might break the $137 resistance and rise to $141.15.
However, this trend might not be the same if Litecoin fails to rise above $118.05. In that scenario, the token’s value might decline to $94.96.
The cryptocurrency’s value might decline to $80.69 in a highly bearish situation.
Disclaimer:
The information provided in this article is for informational purposes only. It is not intended to be, nor should it be construed as, financial advice. We do not make any warranties regarding the completeness, reliability, or accuracy of this information. All investments involve risk, and past performance does not guarantee future results. We recommend consulting a financial advisor before making any investment decisions.
Victor Olanrewaju is a crypto analyst and reporter at CCN with deep roots in on-chain research and technical analysis. His crypto journey began in 2017, but it was the 2020 Uniswap airdrop that sparked a full-time pivot into the space.
With a foundation in copywriting, Victor honed his craft creating high-converting content for leading crypto brokers — most notably an XRP price prediction that ranked #1 on Google during the 2021 bull run.
He later joined AMBCrypto in 2022, where he combined storytelling with technical and on-chain analysis to cover key market narratives.
In 2024, he expanded his expertise at BeInCrypto, collaborating with analysts and using tools like Glassnode, Santiment, and IntoTheBlock to break down Bitcoin and altcoin trends.
At CCN, Victor covers the top cryptocurrencies, memecoins, macro shifts, blending real-time insights with deep-dive metrics.
He holds a Bachelor’s degree in Physics from the University of Ibadan, equipping him to simplify complex data for a wide audience. Follow his work or connect on LinkedIn or X.
