If you are planning to expand or diversify your crypto portfolio, chances are that Litecoin is not on the list of cryptocurrencies you are considering. Cryptocurrencies that have the potential to deliver healthy gains are always on a trader’s radar, and recent developments are more suited to deliver on that front.
Bitcoin's high price tag makes it less likely to double in a short period but the lower you go down the list of cryptocurrencies, the higher the risk. But what if you focus on some of the cryptocurrencies that have been around for a long time but seem to have gone under the radar as NFTs and the metaverse command the most attention. Litecoin is one of the cryptocurrencies that seem to have been sidelined but it is just as notable as Bitcoin and has the potential to deliver healthy returns in the future, especially in case of another major bull run.
Litecoin’s price action
Litecoin is currently trading at $152.33 at the time of this press after a 0.61% gain in the last 24 hours, although it is down by 5.95% in the last 7 days, in line with the bearish sentiments in the crypto market. However, the price is currently heavily discounted compared to its all-time high of $412 achieved at the peak of the bull market which ended in May this year. It also dropped as low as $104 during the consequent bear market that lasted until July.
LTC bears have been dominant since the second week of November, and they managed to push the price below its 50-day and 200-day moving average. Meanwhile, the RSI is currently at 37, which means it is still not in the oversold zone despite pushing towards it. However, the price is currently closer to its 6-month low than its 6-month high, suggesting that it is heavily discounted.
Another notable aspect about LTC’s price action is that it failed to set new all-time highs in the second half of 2021, while other top cryptocurrencies like BTC were setting new highs. This is likely because most of the investment in the crypto market went towards metaverse and NFT projects, as they were deemed to have more growth potential. However, this does not mean that Litecoin is dead in the water.
Why Litecoin is still an attractive cryptocurrency
LTC maintains its appeal for similar reasons to Bitcoin. It runs on a proof of work consensus algorithm and this means it is highly decentralized. This makes it ideal for the type of investor looking to save their money in a decentralized and deflationary coin. Litecoin has a low circulating supply of 69.2 million coins and its market cap is currently at $10.5 billion.
If Bitcoin is the digital gold, then Litecoin is a good candidate for digital silver. Its low price level makes it a more appealing option for the investor looking to take advantage of a potentially bigger multiplier gain than what Bitcoin can deliver, and more potential long-term growth. It is currently trading at a heavy discount, and right now is a good time to get in. A dollar-cost average strategy would be favorable in case of a further move to the downside.