Analysts predict that potential approval of the Spotlight Coin ETF could increase institutional interest and push LTC’s price above $200. Litecoin open interest in the futures market rose to a three-month high, reflecting positive trader sentiment.
Litecoin (LTC) has experienced a notable price increase, rising nearly 10% in seven days. The surge comes on the heels of heightened expectations surrounding asset manager Canary Capital’s possible application for a Spot Litecoin ETF. Additionally, cryptocurrency analysts expect LTC price to rise above $200.
CNF reports that the asset management company has filed an S-1 application with the U.S. Securities and Exchange Commission (SEC) to seek approval for the Spotlight Coin ETF, according to documents filed on October 15. This ETF will be designed to hold Litecoin directly. Meanwhile, its value tracks the CoinDesk Litecoin Price Index (LTX).
This is the first application of its kind in the United States, as no other asset manager in the region has ventured into such a product. As reported by CNF, Canary Capital also applied for a spot in the XRP ETF earlier this month, and the hype extended to its application for the LTC ETF as well.
If the introduction of the Spotlight Coin ETF is approved, there could be a surge in institutional investor inflows to LTC without direct exposure. Analysts speculate that this could cause the price of Litecoin to rise.
Will the price of Litecoin rise?
The recent slump in Litecoin prices has sparked optimism among analysts. Furthermore, even the cryptocurrency market fell by about 15%. Additionally, LTC prices remain down more than 80% from the all-time high of approximately $413.65 recorded in May 2021.
Despite the current weak performance, analysts see a potential ETF that could drive future growth in Litecoin prices. Analyst 28 Crypto suggests that the combination of ETF adoption and a good technical outlook on the LTC/USD monthly chart could lead to further upside.
The chart shows that LTC has been trading within an ascending parallel channel for years. This condition historically indicates the possibility of a breakout. Therefore, analysts predict that the long-term Fibonacci extension target could exceed $2,000 and push the price towards the $200-$300 range.
Similarly, analyst Investing Heaven sees the current price range as an ideal ‘buy on the buy’ opportunity. He believes Litecoin could soon test the June resistance near $88. He also suggested that this could be an attractive long-term entry point for investors.
The enthusiasm surrounding Canary Capital’s ETF filing is further supported by increased open interest in the Litecoin futures market. Open interest on October 16th was $258.94 million, up from $232 million the previous day and the highest level in three months. Additionally, Litecoin achieved a new milestone earlier this month when its hashrate soared to 1.23 PH/s hashrate, CNF reported.
This surge in open interest reflects that traders are poised for further price increases. However, the LTC market slowed down slightly on Thursday, October 17th, with open interest decreasing by 0.56% to $261.66 million. Nevertheless, LTC prices remained resilient, increasing by 0.81%.
Provided by: Coin Glass
Furthermore, the market funding rate turned positive, reaching 0.262% per week. This indicator suggests that traders are willing to pay a premium to hold long positions in LTC. Therefore, current investor sentiment is also reinforcing the momentum behind the recent price rise.
