Litecoin (LTC) prices are rising today, hitting a new three-week high on the back of an overall rally in the cryptocurrency market.
On September 19, the price of LTC rose 3.85% to nearly $68.50, outperforming the cryptocurrency market’s 2% gain on the day. Still, the Litecoin market has underperformed the broader cryptocurrency market in 2023.
Related: Bitcoin investors bullish on Fed’s $100B loss
The company is down 3.85% year-to-date (YTD) compared to the latter’s 39% gain in the same period.
Interest rate pause bets drive Litecoin price recovery
Much of the market’s attention this week will be on the Federal Open Market Committee (FOMC) meeting, which ends on September 20th. At that point, Fed officials may decide to pause ongoing interest rate hikes.
Betting on a rate pause boosted investor appetite for risk assets, with U.S. stocks and most crypto assets rising ahead of the decision. Meanwhile, the dollar has underperformed against a basket of major foreign currencies, with the benchmark index down 0.5% so far this week, including a sell-off on September 19.
The weekly correlation coefficient between Litecoin and the US Dollar has been negative since December 2021, which means that the probability of them trending opposite to each other remains high. As a result, LTC rose on September 19 while the USD fell.
LTC Price: Technical Rebound
Litecoin’s market rally on September 19 was part of a rebound trend that began last week.
Notably, buying began near what appears to be long-term uptrend line support that has capped Litecoin’s downward attempts since December 2018. LTC price rebounded 18.5% eight days after testing the aforementioned trendline.
short liquidation
Litecoin’s rising price led to short-seller liquidation worth approximately $477,300 on September 19. In comparison, only $87,850 worth of long positions faced liquidation, as shown in the CoinGlass chart below.
Liquidating short positions requires derivatives traders to purchase the underlying asset, which combined with purchases in the spot market drives up the price of the asset.
Litecoin Price Analysis for Q3 2023
From a technical perspective, the Litecoin price rebound from long-term uptrendline support may extend to multi-month downtrendline resistance, as shown below.
Therefore, LTC price could reach $78.50 as the next upside target in the coming weeks, representing an increase of approximately 16.5% from current price levels. The $78.50 level served as support in March and June 2023, as well as resistance in January 2023.
Additionally, this level coincides with Litecoin’s 50-week exponential moving average (50-week EMA; the red wave in the chart above).
This article does not contain investment advice or recommendations. Every investment and trading activity involves risks, and readers should do their own research when making decisions.
