Key Takeaways
- Litecoin’s price has remained in an ascending channel, with support at $81.43 ahead of the ETF decision.
- The Chaikin Money Flow (CMF) is turning positive, and RSI at 58.49 signals a growing bullish momentum.
- The Pi Cycle Top suggests LTC could hit $100 if the bullish trend holds and the SEC approves the ETF.
- Without a green light for the ETF, Litecoin’s price might retrace below the $70 mark again.
After falling below $70 on April 9, the Litecoin (LTC) price has formed a bullish structure. This comes as anticipation builds over a potential SEC ruling on a spot ETF today, May 5.
With higher lows appearing on the daily chart and bullish indicators, traders are eyeing a possible breakout for the so-called “digital silver.”
The timing is also crucial, as regulatory clarity via a potential ETF approval could be the catalyst LTC needs to enter a fresh price discovery phase.
In this analysis, CCN checks the likely outcomes for Litecoin’s price, whether the U.S. SEC gives the green light.
Litecoin Hits Higher Lows
Litecoin has been trading within an ascending channel on the daily chart, although it has yet to challenge the key $100 psychological level. This bullish setup emerges just as the SEC gears up to deliver its verdict on the Canary Capital Litecoin ETF application later today.
A close examination of the chart shows that the Chaikin Money Flow (CMF) is flirting with the zero signal line. This was after the CMF experienced a drop into the negative region.
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The rise in the CMF reading indicates increasing buying pressure, which is supported by the Relative Strength Index (RSI). As of this writing, the RSI has risen to 58.49, signifying bullish momentum around Litecoin’s price.
If this trend continues, the LTC’s market value could breach the resistance at $94.63 as long as the support at $81.43 holds.
ETF Drives Bullish Sentiment
Sentiment around LTC has improved ahead of the decision. According to Santiment, Litecoin’s Weighted Sentiment was negative on May 3.
Today, that reading has increased to 0.29. Weighted Sentiment blends the volume of social mentions with the emotional tone, providing a clearer picture of overall crowd sentiment around a coin.
A negative reading suggests there are more bearish remarks surrounding the asset. However, in this case, the positive sentiment score indicates growing bullish comments around LTC, as many are optimistic about a potential green light from the regulatory agency.
LTC Price Forecast: Market Top Not Here
CCN examined the Litecoin Pi Cycle Top indicator regarding the short-term price action. This indicator is used to identify market tops after successfully predicting the 2013, 2017, and 2021 cycle tops.
For context, the metric shows that a crypto has hit the bull market peak when the 111-day Moving Average (MA) crosses above the 350-day MA. But in this case, there has been no such crossover.
Instead, the 111-day MA (green) sits at $100.96, indicating that Litecoin’s price could hit this value. However, that will only happen if the bullish trend continues and the SEC approves the Litecoin ETF.
LTC could rally to the 350-day MA at $172 in a highly bullish market condition. 57.
On the contrary, if the regulator decides not to approve or delays the spot ETF, this prediction might not pass.
In that scenario, Litecoin might experience a correction that could take it below $70 again.
Disclaimer:
The information provided in this article is for informational purposes only. It is not intended to be, nor should it be construed as, financial advice. We do not make any warranties regarding the completeness, reliability, or accuracy of this information. All investments involve risk, and past performance does not guarantee future results. We recommend consulting a financial advisor before making any investment decisions.
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