Litecoin (LTC) is exhibiting bearish signals as its price has dropped below a key support level of $82.40. On-chain data suggests many holders are losing faith in the token, contributing to the downward pressure.
While technical analysis indicates Litecoin could see a short-term relief rally to the $80-$83 range, this bounce is expected to be fleeting within the overall downtrend. The $81.76 level, which coincides with a Fibonacci retracement, looms as a critical resistance point.
If Litecoin cannot surpass $81.76, a 9% decline toward $75 appears likely. The relative strength index hints at oversold conditions in the short term, bolstering the case for a reprieve before the bears regain control.
On-chain data reveals a substantial number of addresses recently acquired Litecoin around the $82.76 level. These investors could seek to exit near the break-even point if prices revisit that area, capping the upside.
Moreover, a spike in zero balance addresses from June 4-8 implies holders are liquidating positions amid diminishing confidence in Litecoin’s outlook, likely fearing further losses.
Despite the prevailing bearish signals, a daily close above $82.40 could invalidate the bearish thesis and spark a 4% rally toward $85.88. However, the weight of evidence currently favors continued downside for Litecoin.
