Barely 48 hours after the completion of the Aug 2 Litecoin Halving, the LTC price has dropped 12%, losing the critical $85 support. As whale investors and long-term holders begin to dump, will the bearish momentum worsen?
On Aug 2, Litecoin completed its third halving event, which sees block rewards issued to miners halved from 12.5 LTC to 6.25 LTC. As observed during the previous halving events in 2015 and 2019, LTC price has once again declined by double-digits.
Having hit $94 on Aug 1, at press time, LTC price has already declined toward $83. This represents a 12% post-halving crash. On-chain data analysis reveals that the bears could have more tricks up their sleeves.
Whale Investors Have Started to Dump Their Holdings
On-chain data suggests that whale investors dumping on the market are currently driving the ongoing Litecoin halving dump. According to data from Santiment, the whales holding cumulative balances of 1,000 to 100,000 LTC began to sell a few days before the Litecoin halving event.
As shown below, the whales held a cumulative balance of 9.77 million LTC on July 29. By August 4, they have now depleted their holdings by 60,000 LTC.
At current market price of $83, the 60,000 coins recently offloaded by the whales are worth nearly $5 million. Such a large outflow of funds within just six trading days is a significant bearish signal to other strategic investors.
If retail investors join in on the halving dump, Litecoin price could slide below $80 in the coming days.
Long-term Holders are Growing Weak Hands
Furthermore, another critical driver behind the ongoing halving dump is the selling pressure coming from the long-term holders. On-chain data shows that Litecoin has witnessed intense bearish pressure from long-term investors this week.
According to Santiment’s Age Consumed data, the sell-off intensified a day after the August 2 halving date.
Indicatively, LTC Age Consumed score hit 37.03 million on Aug 3, up 800% from the 3.96 million recorded on Aug 1.
Age Consumed evaluates long-term investors’ trading activity by tracking how many long-held coins are currently on the move. It is derived by multiplying the number of recently traded coins by the number of days since they were last moved.
An 800% spike in Litecoin Age Consumed within three days means that a lot of long-term holders have started selling. Unsurprisingly, LTC price has seen a sharp drop during this period.
LTC Price Prediction: The $80 Support Level is at Risk
With bearish momentum surrounding the halving dump, Litecoin bears look set to push for the $70 target. For that to happen, the bears must clear the initial $80 support zone.
However, as seen below, 1.53 million addresses that bought 9.31 million LTC at the average price of $80.30 could prevent the drop.
If that support level fails to trigger a substantial rebound, Litecoin price could drop to its next crucial support area at $72.
Still, if LTC regains positive momentum, the bulls could force an early rebound toward $90. Although, 513,570 holders that bought 1.33 million LTC at the average price of $87.77 could stand in the way.
Nevertheless, LTC could promptly reclaim the $90 territory if the bulls can flip that resistance sell-wall.
Disclaimer
In line with the Trust Project guidelines, this price analysis article is for informational purposes only and should not be considered financial or investment advice. BeInCrypto is committed to accurate, unbiased reporting, but market conditions are subject to change without notice. Always conduct your own research and consult with a professional before making any financial decisions.
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