Will Litecoin prices fall below $50.00?
That’s probably the most important question for the short-term Litecoin price forecast, but it’s unlikely to matter over the long haul.
Long-term forecasts depend on underlying factors that investors are ignoring, such as Litecoin’s ability to popularize micropayments or its ability to affirm its role as the “silver to Bitcoin’s gold.”
That’s what the market should be focusing on.
Instead, investors will scramble over yesterday’s 1.81% downtick in the Litecoin to USD exchange rate, wondering what it means.
It means nothing, except that some Chinese investors are unwinding their positions before Litecon to yuan trading ceases for good. Does that mean Litecoin is still overpriced at around $51.63?
The answer to that question depends on your time horizon because it’s possible that LTC prices will swing lower over the next few weeks. However, increased trading volumes from South Korea suggest that Litecoin will find adequate support.
All this week, a Korean exchange called Bithumb was the most active exchange for trading Litecoin. It singlehandedly accounted for 22% of all LTC transactions.
However, overall trading volumes continued to fall, marking a September low at $160.3 million.
To see the last time fewer than $200.0 million worth of LTC coins changed hands, you’d have to go back to August 26.
On the upside, BTC dominance fell from 48.2% to 48.0%, suggesting that China’s impact is starting to fade (because crypto investors flock to Bitcoin during times of crisis like regular investors flock to gold).
I like that BTC dominance is starting to fall, but don’t expect smooth sailing for Litecoin prices—it is going to be a bumpy ride.
My guess is that we’ll see a pattern of quick, fast rushes to the upside followed by a dramatic sell-off. There’s no mystery to it. As I said above, some Chinese traders want to exit the market, so they’ll try to squeeze an extra profit before they do.
Beyond the end of October, though, we could see a return to common sense. If we’re extremely lucky, the market might actually price LTC based on Litecoin news, rather than its current formula of investor expectations and panic.
Wouldn’t that be a novel idea?