An observation of the LTC chart over the past 48 hours shows that the cryptocurrency dropped below $ 42. In fact, LTC dropped more than 10% on April 10, currently holding its price right at the support level above $ 40.
1-day chart of Litecoin
LTC / USD chart on Tradingview
Since the crypto market crashed on a dark Thursday, Litecoin along with the rest of the cryptocurrency industry, has undergone a steady recovery process, the recovery has seen altcoin record a strong consolidation phase above $ 40.
However, over the past two days, Litecoin has seen some degree of correction. From a market perspective, such a correction is considered healthy as prices do not break out of the ascending channel. In fact, the formation of the pattern after March 14 indicates that another pullback may be on the card, but the crypto asset will not fall below the $ 40 mark.
According to the VPVR, trading volume around $ 39- $ 40 has been strong, showing the strength of support. The checkpoint was also in the same place, which showed that the bulls necessarily need to consolidate the bottom at this range.
A probable scenario after the fall will see Litecoin rise above the weak resistance at $ 43, and retest the levels at $ 46.82 and $ 48.72 in a few weeks. next.
In fact, the RSI also suggests that buying pressure has remained relatively strong on charts for the past few weeks.
However, according to CoinMetrics, Litecoin's NVT (Network Value to Transaction Ratio) ratio has dropped sharply since the beginning of 2020, and the same thing also shows the recent decline.
Source: Coinmetrics
A higher NVT often suggests that the token's network valuation exceeds the value transmitted on the network. Whenever NVT achieves a higher rating, it often indicates that investors are valuing assets from a long-term growth perspective.
The decreasing rate of NVT Litecoin is not positive from a market perspective and it may play an important role in the future.
Conclude
Although it is possible to reach the bottom needed in the rankings, Litecoin's NVT ratio is shaped like a large red flag. Bitcoin's correlation with major altcoins is still higher than normal, Litecoin's dependence on Bitcoin remains high until the global economic crisis subsides.
What is the percentage of NVT?
NVT (network value per transaction frequency) is a useful statistic to evaluate network acceptance. Calculated by dividing the network value (total market capitalization) divided by the total amount of USD transferred on the blockchain by on-chain transactions. And do not include any transactions on the exchange because they occur on the exchange, not on the chain.
Similar to the PE (Price-Earning) ratio used in the stock market, NVT can be used to signal whether the market is overvalued or undervalued at any point. When this ratio is high (greater than 1), it means that more values are recognized than actually traded on the network. In contrast, when NVT is low, the market is undervalued.
You can see the LTC price here.
Disclaimer: This is not investment advice. Investors should research carefully before making a decision. We are not responsible for your investment decisions.
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