LTC Gearing Up For Massive 2021?

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  • Litecoin (LTC) could be set for a bumper 2021 thanks to both fundamental and technical considerations
  • Litecoin is one of the very few projects that have no fear of ever being declared a security, which is important for institutional buyers
  • The LTC/BTC chart is looking primed to reverse an 18-month downtrend

Litecoin (LTC) is one of the OGs in the cryptocurrency space, and it could be well placed to enjoy what is building up to be a bumper 2021. There are sound fundamental and technical reasons why this almost ten year old coin could be set to outperform some of its more illustrious and more modern counterparts in the coming months, all of which we look at in our in-depth Litecoin guide.

Security in Not Being a Security

Fundamentally, Litecoin isn’t really in a very different place than it was during the last bull run in 2017. There have been minor upgrades, but the purpose of the coin and its real-world use remain the same. However, it is the coin’s foundations that could set it apart from the crowd.

Litecoin was founded in 2011 by Charlie Lee, at a time when proof-of-work was the only consensus mechanism in operation. Consequently, there was no premine and no coins handed out up front to early backers – what you mined, you kept. The same goes for Bitcoin, while Ethereum had an 11% premine for developers.

Crucially, both Bitcoin and Ethereum have been confirmed as not being securities by the Securities and Exchange Commission (SEC), who recently charged Ripple with being a security. Given that other big players in the space have also fallen foul of securities laws, suddenly many projects in the space are looking over their shoulder – including Ethereum again, as their Ethereum 2.0 protocol may bring them into the scope of the SEC again given their staking mechanism.

Litecoin on the other hand will have no such worries. The SEC has not yet declared it a security but given how it was created it has no worries on that score. Therefore, if institutional buyers are looking to avoid an XRP situation, they will be looking for tokens they are 100% sure will not ever be classed as securities. Litecoin and Bitcoin (and Ethereum, for now) are the only ones.

Chart Suggests Reversal is Imminent

As well as looking good in a fundamental sense, LTC also looks good technically. A look at the weekly chart shows us that LTC has been in a downtrend against BTC ever since July 2019, a downtrend it finally broke two weeks ago:

LTC chart 1

Having finally broken through this downtrend, we can clearly see that it has been nothing but good news ever since, as we can see on the daily timeframe:

LTC chart 2

The uptrend is even more pronounced on the 4-hour chart:

LTC chart 3

We can clearly see then that LTC is reversing an 18-month trend, but what do we need to look for to confirm that this isn’t a fakeout? The first step is clearing the resistance level at around 5,365-5,438 satoshi:

LTC chart 4

Flipping this level and turning it into support would act as confirmation that LTC is ready to move upwards. The importance of flipping this level becomes apparent when you look at LTC over time:

LTC chart 5

This two-weekly chart makes it obvious what flipping the 5,400 satoshi region will mean, as well as what it could lead to. If, as anticipated, we have an alt season in Q1 of 2021, LTC could well be one of the biggest performing big cap coins, with over a year and a half’s downturn to make up for.

How High Can it Go?

The big question of course is what value can the LTC price reach? As we can see from the all time chart, the level at which LTC has topped out has been diminishing since the 2017 crypto bull run, which goes hand in hand with the philosophy that Bitcoin dominance has the potential to wreck the concept of an alt season:

LTC chart 6

Were this trend to continue, a Q1 2021 at season would see LTC top out at 110,000 satoshi, which happens to be a long standing resistance level. This would represent just over 2x in BTC tems, something that is certainly not to be sniffed at given what it looks like Bitcoin could achieve next year.

LTC Set to Be Surprise Package of 2021

All in all it seems that LTC has a great chance of being something of a surprise player in 2021. While the spotlight will be on BTC, ETH, and XRP (for very different reasons) LTC could end up being a stealth play that pans out very nicely for those willing to hold.