Litecoin Activity Rises in 2024, Value Threatened by Selling Pressure
Litecoin 2024: What Awaits Traders?
Litecoin (LTC) has started the year with an increase in transaction numbers, indicating renewed interest and activity in the network. According to on-chain data provider IntoTheBlock, Litecoin has processed over 6.3 million transactions in the last 10 days.
Rising Activity and Transaction Fees
The increase in transaction numbers on the network is due to a rise in active addresses since the beginning of the year. Data from Glassnode shows that since January 4, the daily number of unique addresses active on Litecoin, either as sender or receiver, has increased by 17%. In addition, the rise in activity has driven the network’s hash rate to the second-highest level of 885.09 TH/s on January 10.
Due to the increase in user activity, the year has also seen a jump in transaction fees on Litecoin. Since January 4, the total amount of fees paid daily for processing transactions on the chain has increased by 38%.
Decline in New Demand
Interestingly, despite the increased activity of existing users, there has been a decline in new demand for the chain since the beginning of the year. According to data from Glassnode, the daily number of unique addresses appearing on the network for the first time in a transaction with LTC has dropped by almost 45% in the last 10 days.
Price Rise of LTC
Although the price of LTC has risen in recent days, a closer look at some key indicators suggests that the rise is more driven by the expectation of a Bitcoin ETF than by real demand for the coin itself. At the time of publication, LTC was trading at $70.72 and had risen by 8% in the last seven days.
Downtrend for LTC?
The Awesome Oscillator indicator shows green, downward-facing histogram bars, suggesting that LTC may lose these gains. When this indicator has green, downward-facing bars, this generally indicates a weakening bull trend. This means that while the price may still rise, the rate of increase is decreasing, which could indicate an impending trend reversal.
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Similarly, there has been a sharp decline in LTC accumulation among day traders. The coin’s Money Flow Index (MFI) was below its midline and in a downtrend at the time of writing. This suggests that selling pressure is exceeding buying pressure, exerting downward pressure on the price of the altcoin.
Sources: IntoTheBlock, Glassnode, CoinWarz, CoinMarketCap, TradingView
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