The Litecoin price surged 6% again in the past 24 hours, after a week-long rally. It has become the second-best performing cryptocurrency by weekly gain.
What’s triggering the Litecoin price rally?
There are three major factors behind the Litecoin price rally: ideal technical structure, Bitcoin’s rally, decent fundamentals.
Jonny Moe, a cryptocurrency trader, pinpointed the LTCBTC pair’s momentum. Most altcoins, including Ethereum, have stagnated against BTC.
Hence, Litecoin showing some strength on the LTCBTC pair is noteworthy. He said:
“LTC on the $LTCBTC pair looks loose and ready to run. On $LTCUSD, we are completing a huge weekly Adam and Eve double bottom pattern with a neckline @ $146.”
Atop the favorable market structure of Litecoin, the Bitcoin price has been increasing rapidly. This has caused the overall confidence in the market to increase.
Philip Swift, the creator of LookintoBitcoin.com, said there were some sellers on Coinbase but there has been lots of on-chain activity.
The continuous increase in the on-chain activity of Bitcoin has led the price of BTC to surpass the previous all-time high.
On December 27, Bitcoin rose to as high as $27,632 across major exchanges, achieving a new all-time high. The analyst noted:
“BTC price action looks strong here. Few sellers on Coinbase in the short term shown here by the lack of asks (yellow lines) above price. In terms of on-chain activity… Advanced NVT (blue line) has actually pulled back from the overbought (red zone) as price went sideways/up. This indicates LOADS of on-chain activity over the past week or so, and suggests more potential for upside in short term.”
Some argue that the rising price of Bitcoin is bad for altcoins, as BTC sucks out the volume from the market. However, Litecoin has been one of the only altcoins that have been increasing in value against BTC.
LTC’s strong fundamentals
John Kim, a Litecoin evangelist and a Litecoin Foundation member, named various factors that buoy the fundamentals of the cryptocurrency.
Kim pinpointed the 98% dominance of Litecoin in the Scrypt consensus algorithm space and $500 billion historical volume on the network. Kim wrote:
“Zero Downtime, 100% Uptime; King of Scrypt with 98% dominance; Over 500 B transacted on it’s network; Segregated Witness before #BTC; Time tested & proven; One of the most liquid and on about every exchange; 2nd place at ATM’S; MimbleWimble.”
The combination of optimistic fundamentals of the Litecoin network and the strength of the LTCBTC pair has been the main catalyst of LTC so far.
Whether the continued momentum of Bitcoin could hurt the altcoin market’s prospect in the near term remains to be seen. The Bitcoin dominance index has been climbing closer to 70%, which puts an “altcoin season” at risk.
Get an edge on the cryptoasset market
Access more crypto insights and context in every article as a paid member of CryptoSlate Edge.
Like what you see? Subscribe for updates.