On Thursday morning, a return of investor enthusiasm lifted the overall crypto market cap above $173.0 million. With the exceptions of NEM and NEO, this influx of cash raised prices for the top 10 biggest cryptocurrencies by market cap.
That said, the inflows (from fiat to crypto) are not evenly distributed.
Don’t be fooled by the Litecoin to USD exchange rate. It rose 3.13%, to be sure, but that feat grows less amazing upon closer inspection.
Why, you ask?
Because, dear reader, Litecoin’s gains were comparatively weak. it depreciated 4.74% against Bitcoin, which, in turn, accelerated back towards the $6,000 level.
If you think I’m exaggerating, take a look at the data.
BTC dominance—which measures Bitcoin’s market share of cryptocurrencies—rose from 55.9% to 57.5% in 24 hours. I think it’s safe to say this is more than a suspicion.
Once bandwagon investors see this trend, they may start to sell their Litecoin into Bitcoin. Or worse still, newly-initiated crypto investors will think Bitcoin offers bigger upside. We simply do not believe that.
After all, isn’t Litecoin the “silver to Bitcoin’s gold”? The two currencies are supposed to move in sync, yet Litecoin’s ascent in the last month has been much shallower than Bitcoin’s.
Daily Litecoin Chart
Don’t forget that Litecoin was trading near $90.00 in September. It only crashed when China banned cryptocurrency trading. But then again, so did Bitcoin and the rest. The difference is that Litecoin failed to recover as quickly as its peers.
Bitcoin recovered within weeks, then rallied to new all-time highs. Meanwhile, Litecoin stagnated behind, struggling to break modest thresholds. There is something obviously wrong with this picture.
It’s easy to see that Litecoin and Bitcoin are out of step. As that ratio moves to rebalance, LTC could regain its previous high of $90.00. Once that benchmark is reached, we believe that the currency could accelerate towards our Litecoin price forecast of $200.00.