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Litecoin price remains sandwiched within the $81 – $83 narrow channel since the start of May 2024, despite bullish momentum returning to the crypto market this week. Critical on-chain metrics are flashing early signs of an imminent $LTC breakout.
$LTC Price Action Falls Behind Market Trend
Since the start of May 2024, Litecoin price continued to move sideways, as the bulls struggle to flip the $86 resistance cluster. Despite the bullish tailwinds from the cooler-than-expected inflation reported in the latest US CPI data, $LTC price has failed to attract investors interest this week.
Consequently, $LTC price action has now fallen far behind the broader crypto market average.
As seen above, $LTC opened trading on May 1 at around $79.50. However, at the time of writing on May 16, Litecoin’s price reached $83, reflecting only a 4% upswing for the month.
However, Litecoin appears to be underperforming by a large margin. Compared to $LTC’s 4% bounce, the TOTAL Cap chart, which captures the real-time growth in the cumulative market capitalization of all listed crypto assets, has increased by 15.1%.
Whales Invest $80 Million to Front-run $LTC Breakout
Litecoin’s underwhelming sideways price performance in the first half of May 2024 has been well-documented. However, recent on-chain data trends show crypto whale investors have been making large volume $LTC purchases this week, likely to front-run a potential price breakout.
The Santiment chart below tracks real-time swings in $LTC balances controlled by whale wallets holding a minimum of 10,000 $LTC (~$800,000).
Looking at the chart above, the Litecoin whales held a total balance of 47.91 million $LTC as of May 8. However, a week later, that figure increased significantly to reach 48 million $LTC at the time of publication on May 16.
Valued at the current price, the Litecon whales have effectively spent over $80 million acquiring 90,000 $LTC between May 8 and May 16.
When whales make such large purchases during periods of flat price action, as observed above, it suggests they may be looking to front-run an imminent breakout.
$LTC Price Forecast: $86 Resistance Looms Large
Drawing insights from the whale’s $80 million fresh purchases in the past week, Litecoin price could be setting up for a major breakout towards $100 in the days ahead.
However, derivatives market indicators show that $LTC bulls face a looming brick-wall around the $86 territory. Coinglass’ Liquidation heatmap data below shows that bear traders stand to lose over $5.8 million on leveraged SHORT contracts if Litecoin price moves above $85.9.
To avoid booking such large losses, many Short traders could look to cut-down on their positions or deploy stop-loss triggers as price move towards $85.9. This inadvertent surge in sell-pressure could put downward pressure on $LTC in the near-term.
But if the short traders move to hedge their positions with LONG spot purchases, Litecoin price stands a healthy chance of fipping the $85.9 resistance has heading toward $100 as predicted.
In the event of a market correction, bulls could mount a short-term support cluster around the $79 level to avoid losing over $5 million to LONG contract liquidations.