Summary
- Litecoin has shown significant growth in value since the beginning of the year but may lose more ground to BTC and ETH.
- LTC has not developed a bubble despite the recent upsurge in institutional investment in cryptocurrency.
- The recent LTC/USD trend promises stable but comparatively lesser returns.
Litecoin lost more ground on Tuesday, reducing in value by about 18.2% to drop from a high of $208 recorded on Monday to $170. This was the second straight day of decline, after an earlier gain of 0.22% on Sunday. However, Litecoin’s year-to-date returns are still an impressive 40.2% gain.
The recent past has seen the global crypto market exhibiting a bullish character, with some analysts predicting that Litecoin could hit $1000. However, the cryptocurrency is about 53% below its all-time high of $360. Nonetheless, it remains a dependable and valuable asset, with a market capitalization of nearly $13 billion, making it the eighth-most valuable cryptocurrency.
Institutional gains
Litecoin is among cryptocurrencies that have gained institutional investment. This is a significant milestone, as it will help the virtual currency gain traction for long-term growth. Therefore, despite not hitting historical highs in the recent past, Litecoin exhibits good growth potential. Businesses have adopted it as a channel for exchange and incorporating it as a means of payment.
Prominent investors have also given it their vote of confidence. Recently, the founder of Crypto Capital Venture, Dan Gambardello, stated that investors should look forward to the rise in the price of Litecoin in the market. He also projected that Litecoin’s price would likely go past the $1000 mark.
Over the past month, PayPal has incorporated Litecoin in its system, starting with its operations in the United States. The company aims to enable clients on its platform to buy, sell or hold digital currencies such as Litecoin. This is a major milestone, considering PayPal’s footprint in global finance.
Additionally, early this month, Rob Anson, the CEO of Loop Insights, announced that its device, Fobi, had been designed to incorporate top-ranked digital currencies, including Litecoin, into its payment system.
Litecoin prices could also possibly gain significantly from an endorsement by celebrities. Two days ago, Gene Simmons, an American musician, revealed that he had invested in Litecoin. The singer tweeted that he was “a happy investor” in the digital currency.
Dogecoin’s rise to the top has been attributed to a celebrity endorsement. It would therefore be imprudent to dismiss the impact of popularity-driven price increases, regardless of how controversial they are.
A safer haven than BTC and ETH
The past few weeks have seen most of the limelight fall on Bitcoin, Ethereum, and Dogecoin, which have made monumental gains. On the other hand, Litecoin’s gains have been marginal. However, this possibly makes Litecoin a safer investment compared to its competitors.
A significant number of investors are already jittery over the unprecedented gains made by BTC, ETH, and Dogecoin. Therefore, there’s an increasing likelihood that such investors will begin dumping their coins to consolidate the profits made so far for fear of a “looming bubble burst.”
LTC/USD technical outlook
The price of the LTC/USD pair has been increasing steadily since the start of the year. At the time of this writing, the Relative Strength Index (RSI) of LTC/USD has been moving upwards, indicating a bullish trend.
The pivot and support levels of the price of the LTC/USD will be at $213.99 and $204.99, respectively. LTC will meet resistance at $203.47, beyond which it could gain momentum and test $223. However, a price below $158 could lead to a decline towards the $120 territory.
