- Litecoin’s Open Interest-Weighted Funding Rate has turned negative (-0.0062%), signaling a rise in LTC short positions.
- LTC faced rejection at the 50-day EMA ($87.60), with RSI dropping to 45 and MACD nearing a bearish crossover, hinting at a further drop to $77.19.
The key indicators and on-chain data suggest that Litecoin (LTC) is facing downward pressure, with the market trend exhibiting increased bearish indicators. Trading just below $84 on Wednesday, the LTC price has slipped following a recent rejection from a key technical barrier earlier this week.
Litecoin Whale Sentiment Shifts
A behavior change in the whales is adding to the doomsday picture. Blockchain analytics platform Santiment has outlined a large Litecoin investor within the range of 100K to 1 million LTC wallet bracket that has been in a clean-up mode since June 24.
In total, this entity has sold approximately 540,000 LTC, generating overwhelming supply and intensifying selling pressure, as mentioned in our previous report.
This continued distribution is accompanied by rising bearish activity in the derivatives market. The Open Interest (OI)-Weighted Funding Rate of LTC entered its negative zone on Wednesday, as Coinglass data shows a value of -0.0062%.
It signifies that short positions are prevailing over long positions and traders are paying a premium to bet against price increases. Historically, similar shifts in funding rates, such as the one observed on June 18, have aligned with notable price drops in Litecoin.
Closer Look At LTC Price Technicals
Technically, Litecoin price faced a major resistance at the 50-day Exponential Moving Average (EMA) around $87.60, according to TradingView data. This rejection has caused the price to fall more than 5% in recent days as LTC falls back into a risky price zone.
This EMA is also in confluence with the upper boundary of a falling wedge pattern, adding weight to its importance as a resistance threshold.
The Relative Strength Index (RSI) is resting at 45 on the daily chart. This indicates that the bearish momentum is intensifying, with readings dropping below 50 and closing in on the “oversold” territory. In the meantime, Moving Average Convergence Divergence (MACD) also indicates the possible bearish crossing.
The MACD line is close to breaking below the signal line, a pattern that generally suggests a downward change of momentum. In the event of continued bearishness, Litecoin may have the opportunity to retest its weekly base at $77.19, which marks a previous consolidation zone and could serve as a short-term price floor.
Although the Litecoin price is now dropping, a temporary upswing would probably cause LTC to make an effort to reclaim the 50-day EMA.
This level has previously acted as a pivot point several times, leading to a rebound. However, the broader trend remains fragile as investor sentiment continues to lean toward caution, especially given the substantial volume of whale activity and the declining funding rate.
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