Mere weeks ago, Litecoin (LTC) underwent its latest block reward reduction — also known as a “halving” or “halvening”. While many expected for this to kick off the cryptocurrency’s next surge, it didn’t. In fact. the popular altcoin plunged after the halving, falling from three digits to $72, where LTC sits at today.
This corroborates a report from Strix Leviathan, a Seattle-based crypto startup, which found earlier this year that crypto assets that see their emission halve “outperform the broader market in the months leading up to and following a reduction in miner rewards.”
The popular Bitcoin fork may be in for a price bounce, though. Analyst CL recently pointed out that Litecoin recently dropped to its 50-week moving average, which has acted as both a level of support and resistance, then recovered. As he/she points out, the “last time LTC stopped dumping after the halving was at the weekly 50 moving average; it was also a local Bitcoin bottom.” History repeating would imply a strong recovery in the coming months.
That’s not the only technical trend supporting a Litecoin recovery. Analyst Nebrakskan Gooner confirmed this somewhat bullish sentiment, noting that LTC has managed to break past a downtrend that it has been situated in since June, which he claims is a sign that a 10% move to the $79 region is likely.
Altcoins to Gain Market Share
The call for a Litecoin bounce comes as analysts have started to expect for altcoins to finally retake some market dominance against Bitcoin.
Adaptive Capital’s Willy Woo remarked last month that altcoins were “heading into a region of support” at long last. This trend has continued into early-September. The prominent on-chain analyst, known for his reports on how Bitcoin’s network effects equate to its value, remarked that the altcoin vs. Bitcoin market capitalization chart is “now two weeks into testing its 6.5-year support line”, which has yet to break. What’s more, the weekly relative strength index (RSI) of this chart is “more oversold [than its been] in its entire history”.
Woo didn’t explicitly call for what cryptocurrency traders call an “altseason”, only claiming that altcoins may see “some bounce”.