Famous crypto analytics firm Santiment has warned that Litecoin is in dangerous territory after the price increase. Crypto analytics firm Santiment thinks the rapid ascent of popular altcoin Litecoin to new local highs has put the asset into dangerous trading territory. Detail cryptocoin.com‘in.
Endangered altcoin Litecoin
In a new Litecoin (LTC) market update, Santiment points to several useful metrics for tracking Litecoin’s price action and measuring the overall health of the network. The analytics firm states that Litecoin is in the “danger zone” because short-term holders are now in a position to make a profit. Santiment uses an indicator that relates market value to realized value (MVRV), which shows the average profit/loss of all cryptocurrencies currently in circulation relative to the current price. Santiment: “The 7-day MVRV 7D, which measures the short-term profit/loss of LTC holders, shows that we are now in the danger zone as all short-term holders are in profit – which may encourage them to take some profits.”
In September, LTC was sitting at a one-month low of $140 before hitting a new local high of $295, collecting more than 100% from that level. Santiment also notes that Litecoin’s price seems to have caught up with Bitcoin’s relative gains since September’s low: “An interesting thing to note is that LTC’s price reflects very closely to BTCs… This is also when BTC drops. It just means that LTC isn’t exactly a strong altcoin because it doesn’t show any strength, it’s essentially BTC dragging it along.”
While Santiment expects Litecoin to consolidate, he says an on-chain metric is the strength signal for the LTC network: “LTC’s Daily Active Addresses” has been pretty consistent and growing over the last 3 months, which is great because that’s what we want to see in a healthy network.”
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