Santiment Looks Into Litecoin After The Recent Price Appreciation
According to crypto analytics firm Santiment Litecoin’s rapid price ascend to new local highs is putting the altcoin in “danger zone.”
Santiment, in a recent Litecoin (LTC) market update, is looking into a couple of useful metrics to analyze Litecoin’s price action and determing the network’s overall health.
Litecoin is in the “danger zone” as short-term holders are now in a position to take profits, according to the analytics firm. One of the tool that Santiment uses is the market value to realized value (MVRV) seven-day indicator, which shows the average profit/loss of all the coins currently in circulation according to the current price.
“LTC’s MVRV 7D which measures the short-term profit/loss of holders is showing that we are in the danger zone, as all short-term holders are in the profit at the moment – which could incentivize them to take some profits.”
Earlier in September, Litecoin was at a month low price of $140 before rallying more than 100% off that level to a new local high of $295.
Litecoin is trading at $257, at time of writing.
Santiment also notes that Litecoin price appears to move along with Bitcoin’s (BTC), meaning alone it’s not really a strong altcoin.
“One interesting thing to note is that LTC’s price mirrors very closely to BTC’s…This also means that LTC isn’t exactly a strong altcoin as it didn’t show any strength when BTC dumps, it’s mainly BTC dragging it along.”
While one on-chain metric signals strength for the LTC network, overall Santiment expects Litecoin to consolidate.
“LTC’s Daily Active Addresses’ been rather consistent and growing over the past 3 months (even despite the major dip in September), which is great as this is what we want to see in a healthy network. It recently saw a spike in DAA as price spiked (naturally so) and has not seen any major drop yet, so far so good.”
