As price of Litecoin reaches a new all-time high for the year, investors are told to exercise caution in accordance with the 30D MVRV signal.
Last week, Litecoin(LTC) led the top ten cryptocurrencies, with gains exceeding 25%. On Monday, July 3, the LTC price reached a new peak of $114, surpassing $8 billion in market capitalization.
The cryptocurrency has a solid favorable sentiment, with the Litecoin halving event occurring in roughly 40 days. While analysts have projected further price increases for LTC, the on-chain indicator suggests that investors should proceed with caution. Ali Martinez, a renowned expert in cryptography, elaborated:
Currently, #Litecoin MVRV 30D hovers around 35%. Historically, each time $LTC MVRV 30D exceeds the 30% mark since 2018, a sharp price correction typically follows! This usually translates to a #LTC price drop ranging from 30% to 40%.
Earlier this year, in 2023, the Litecoin (LTC) price crossed $100 twice; however, it was shortly met with intense selling pressure and fell nearly 20% before recovering.
Incoming Litecoin Halving
According to the schedule, the Litecoin blockchain will endure the halving event around the middle of August next month. Litecoin devotees are preparing for a significant event known as the “halving.” This event, which occurs on August 5, will reduce the creation of new LTC coins by half.
This decrease in new coins entering the market will influence supply and demand, possibly increasing prices. The price of LTC has increased by approximately 53% since the beginning of 2023, reaching $114.50 on July 3. The upcoming halving event has generated enthusiasm and anticipation among investors, who anticipate it will further increase the value of LTC.
The Litecoin hashrate reached an all-time high last week as network activity surged in anticipation of the halving. The LTC hashrate increased significantly in June. This increase in hashrate was accompanied by an increase in mining difficulty, making the discovery of new blocks more difficult.
Miners have responded to this difficulty by incorporating more machines into their mining operations to increase their likelihood of effectively locating blocks. Consequently, the global hashrate has increased.
