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Classic crypto makes a massive comeback in the market, beating most digital assets
Contents
- The 36% jump in Litecoin
- The market is recovering
Finally, cryptocurrency market momentum is normalizing, with most assets returning to their normal price range and some of them showing exceptionally strong performance, despite the depressing state of the market.
The 36% jump in Litecoin
LTC has surprised cryptocurrency investors in the market over the past few months as it has been actively breaking out since August. Unfortunately, heavy selling pressure negated any successful performance of LTC in the market, pushing it back into the trading range it was moving in prior to the breakout attempt.
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Finally, on November 2, Litecoin made a successful breakout attempt, breaking out of the three-month trading range and approaching the local resistance level reflected in the 200-day moving average. On November 7, LTC failed to break above the moving average and dropped to the lower range of the trading channel.
Two days ago, the bulls continued to drag LTC to new highs, providing over $43 million of buying support, which became the basis for the rally that is now fueled primarily by retail investors jumping on the strongest position in the market.
While Ethereum or Bitcoin holders have no choice but to see the profitability of their holdings drop to the 50% threshold, most Litecoin investors are returning to profit, according to profitability indicators.
Only a slight price increase of 5% will allow long-term holders to regain profits despite the prolonged downtrend that Litecoin has been experiencing for the past 560 days. Such a devastating performance all but destroyed LTC’s attractiveness to investors, but that could change if the explosive price performance trumps the cryptocurrency.
The market is recovering
In the past 24 hours, more than $50 billion has returned to the cryptocurrency market, which is the main reason for the positive price performance of the majority of assets: Litecoin, Bitcoin, Ethereum, and more altcoins. small businesses posted solid recoveries in all areas.
While there is no fundamental reason behind the market returning to the green zone, the most likely cause for the positive net cap flow is the lure of oversold digital assets that provide more opportunities for investors who want gradually gain exposure to cryptocurrencies.
Unfortunately, cryptocurrencies still have a long way to go before reaching pre-FTX price levels. Worse in the crash of the SBF empire is the damage to the reputation of the industry which will be seen as even more dangerous for institutional funding.
Since the May crash, institutional inflows into the industry were at extremely low levels, and most of them were exposed to various short Bitcoin ETFs that give inventors reverse exposure to BTC.
Despite some positivity in the cryptocurrency market, it is too early to call it a day and declare the start of the recovery. The digital asset industry would still need to recoup around $200 billion in capitalization to get back to pre-FTX levels. At this point, it is unclear what will fuel the market rally.
