Litecoin (LTC) trades near flat levels, with analysts suggesting a weak chart pattern despite its recent gains. Data shows a lack of momentum in LTC, with derivatives and resistance levels focusing on whether it can hold its current position or not.
According to CoinMarketCap data, LTC is trading at $56.05 at press time. The token has gained 0.49% in the last 24 hours. Trading volume stands at $287.34 million, down 15.31%. The token market capitalization stood at $4.31 billion, up 0.41% over the same period.
LTC Shows Divergence Despite Rising Channel
A prominent analyst, Umair Crypto, highlighted that LTC failed to break out on the BTC pair. The pair attempted a move higher but could not hold above the range. It then moved back inside the structure. He said a failed breakout in a downtrend adds bearish weight instead of resetting the chart.
On the USDT pair, LTC is continuing to rise inside a channel. However, analysts noted that the RSI trendline has already broken and is now being retested.
He described this setup divergence rather than strength. In his opinion, a rising price with a broken trendline in the RSI indicator does not confirm bullish strength.
The analyst also identified two factors that need to be fulfilled for the next leg down. First, the USDT pair needs to fall from the 50 RSI level again.
Second, the BTC pair needs to close below 770 and fall from the 50 SMA. If both factors appear on the charts, the analyst said that the range breaks and the target zone becomes the low $40s and high $30s.
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SEC Classification and LitVM Launch Fail to Lift LTC
The cryptocurrency also experienced two significant events in the past week. Firstly, LTC is classified by the SEC as a digital commodity on March 18th.
In addition, LitVM rolled out its testnet, which is Litecoin’s first EVM-compatible Layer 2 solution. However, this is not reflected in the token’s price, based on the market response, according to the analysts.
However, CryptoWZRD, another analyst, also presented a more constructive short-term outlook. He mentioned that LTC closed bullish as it followed Bitcoin’s sentiment.
Nevertheless, he noted that the token needs to rise above the $57.50 resistance point to trigger the next bullish action. Additionally, he added that the token needs to hold above $56.50 to sustain the long opportunity on the intraday chart.
Funding Rate Stays Positive Despite Volume Decline
CoinGlass data shows mixed activity in the derivatives market. The trading volume is down by 22.56% to $336.94 million. However, open interest is increased by 2.20% to $330.70 million. The OI-weighted funding rate stood at 0.0045%.
This article contains market analysis and price predictions. These are not guarantees. Crypto markets are volatile. Always DYOR. Not financial advice.
Also Read: Litecoin (LTC) Eyes $500+ Rally Following SEC’s Crypto Commodity Announcement
