- Litecoin, at press time, was testing key resistance levels, with a potential breakout towards $170 if it holds
- On-chain signals and MVRV ratio hinted at sustained growth, supported by rising market sentiment
Litecoin [LTC] recorded a remarkable surge in February, gaining by +25% against Bitcoin and exhibiting some strong bullish sentiment. At press time, Litecoin was trading at $127.08, following a solid 8.14% hike over the last 24 hours alone.
The crypto’s impressive price action coincided with a surge in active addresses too, with the same climbing to over 445k for the first time since early February.
Technical analysis – What’s next after a breakout?
An assessment of Litecoin’s price action suggested that the cryptocurrency was trading within a consolidation zone. The upper resistance was marked at $137.83, while the lower support level sat at $114.33.
At press time, the altcoin seemed to be edging closer to the resistance zone. If Litecoin manages to break above $137.83, it could trigger a rally towards $170.
However, if the price fails to surpass this resistance, it may retreat back into the consolidation range, testing the support level at $114.33 or even the lower $98.18-level. Therefore, the crypto’s next major move will depend on its ability to break through the resistance and hold above these critical levels.
Source: TradingView
On-chain signals – Are investors still bullish on Litecoin?
On-chain metrics for Litecoin supported this bullish thesis, indicating growing market demand. For example – The Net Network Growth metric increased by 0.34%, highlighting more new addresses joining the network.
Additionally, large transactions rose by 1.73%, signaling greater interest from institutional players or high-net-worth individuals. The concentration of LTC in a few addresses low to has remained low too, which is a positive signal for price growth.
Therefore, these on-chain indicators, together, suggested that demand for LTC remains strong.
Source: IntoTheBlock
MVRV ratio – How much more room for growth does LTC have?
The MVRV (Market Value to Realized Value) ratio has been steadily rising too, with the same currently at 0.669. This steady hike meant that LTC’s market value was still relatively low, compared to its true value – A sign that the cryptocurrency could have more room to grow.
A rising MVRV ratio is a bullish signal, especially when combined with positive on-chain data. Therefore, investors might expect the price to continue appreciating as long as this trend persists.
Source: Santiment
Is Litecoin’s market optimism here to stay?
Finally, the weighted sentiment around Litecoin has also been improving. At press time, the sentiment had reached 1.60, up from previous months. This hike in sentiment reflected growing optimism in the market, which could encourage further buying activity.
Additionally, this shift in sentiment seemed to be in line with the uptick in LTC’s price and growing address activity.
Source: Santiment
Can Litecoin maintain its bullish trend?
Given the current technical setup, on-chain signals, and increasing market sentiment, Litecoin may be poised for sustained growth. The rising MVRV ratio, improving sentiment, and strong on-chain metrics supported a positive outlook.
However, LTC must break through the resistance zone at $137.83 to confirm the uptrend and avoid a potential pullback.
Conclusively, if Litecoin manages to break these resistance levels, the bullish trend is likely to continue, possibly reaching the $170-mark.
