Key Takeaways:
- Litecoin (LTC) price drops 20% in July.
- Whale accumulation slowed before halving.
- Buy the rumor, sell the news?
YEREVAN (CoinChapter.com) – Litecoin token LTC price shaved 4% off its value in the previous 24 hours, dropping to $92 in the European session on July 31. The move came as a continuation of the bearish momentum, and the token lost 20% since peaking at $115 on July 3.
Litecoin price risks losing 15% in the coming weeks
Meanwhile, the veteran altcoin eyes another 15% drop in value, as it has been trading within a “consolidation “rising channel” year-to-date.
The setup features two rising trendlines with a powerful mid-range. After the mentioned decline in July, Litecoin (LTC) price action retested the channel’s mid-range twice since July 22, unable to breach it. Given the drop in trading volumes, another support retest appears likely within the next two weeks. Thus, LTC risks shaving another 15% off its current value, as the target price would stand at approximately $76.
Whale accumulation slows 3 days to Litecoin halving
The bearish turn looks in line with a phenomenon known as “buy the rumor, sell the news,” when a coin gains traction and price increase before a large event and slumps right after. As previously reported, the Litecoin blockchain prepares for a halving event scheduled for August 2 at 17:25 GMT.
During a halving, the amount of Litecoin created each time a block is mined is cut in half (12.5 to 6.25 LTC). It essentially strengthens the incentive to mine as much as possible just prior to the halving. Additionally, the halving puts more value on each existing LTC coin, as investors are aware of the slower production of each coin moving forward.
Litecoin whales, i.e., addresses with large amounts of LTC, have been actively accumulating throughout May and June. However, as the chart below demonstrates, the rate of accumulation has slowed as some whales decided to collect their gains.
According to the chart below from on-chain data provider Santiment, three whale categories holding 1000-10,000 LTC (yellow wave), 100,000 – 1 million LTC (pink wave) have partially dropped their holdings, while the largest category with 1-10 million LTC (red wave) maintained the positions in the previous week.
The charts also testify that the number of transactions among the group remains high. Combined with the previous metric, the high trading volumes among whales points to a sell-off continuation in the short term rather than an accumulation.
The dropped realized market cap confirms the short-term bearish expectations.
