LTC remains up 8%, a notable departure from Bitcoin’s recent sell-off. Will this trend hold or will it succumb to Bitcoin volatility?
Litecoin (LTC) has rallied around 3% over the past seven days amid wild market swings, led by Bitcoin (BTC)’s failure to hold the critical $57,000 support. It is currently trading at $66.37.
Analysts note that September has historically been a bullish month for LTC. However, AMBCrypto pointed out that Bitcoin often turns bearish during this period.
That said, is Bitcoin’s September weakness driving Litecoin’s rally? Are investors choosing LTC as a safer option, or is it becoming the pre-eminent alternative? AMBCrypto investigates.
Bitcoin’s influence on LTC remains strong
Source: TradingView
Interestingly, since early August, LTC has surged over 17%, rising from $56 to $66. Bitcoin’s massive rally, which tested $64,000 during this period, likely fueled this rally.
However, while Bitcoin started on a bearish note in September, falling below $57,000, LTC bulls prevented a similar decline.
According to AMBCrypto analysis, LTC has maintained an 8% upward swing since August 28 despite BTC’s bearish dominance.
Bitcoin’s influence on altcoins is well known, but this level of divergence is unusual.
AMBCrypto examined historical price charts to determine whether this anomaly is a temporary spike or reveals a deeper pattern.
Source: Glassnode
The chart above revealed a significant correlation between the two coins. Three years ago during the rally in early September, LTC tested the $200 level and BTC broke through the $50,000 resistance level.
Following this, LTC declined as BTC retreated to the $40,000 support line. Moreover, every time Litecoin approaches a high, it has been supported by Bitcoin’s bullish momentum.
In short, this trend highlights Bitcoin’s superiority over Litecoin and suggests that the recent anomaly may be only temporary. This raises the question of what caused the difference.
There is a tactical development behind Litecoin’s sharp rise
In a recent post on X (formerly Twitter), Litecoin developers announced a historic achievement. Litecoin currently leads Bitcoin by more than 10% in trading volume.
Furthermore, Bitcoin’s continued volatility is clearly attracting the attention of prospective traders, as evidenced by the high open interest shown below.
Source: Coin Glass
Following the day, Bitcoin bears risked a long-awaited rebound, with Litecoin’s open interest soaring from $213 million to $252 million, an 18.3% increase, and its volume. It jumped from $277 million to $482 million, reflecting a 74% increase.
Conversely, Bitcoin’s OI decreased by 6.2% from $31 billion to $29.07 billion. Meanwhile, its volume decreased from $78 billion to $68 billion, reflecting a 12.8% decline.
This spike in user activity is consistent with LTC’s recent uptrend and highlights Litecoin’s strategy to outperform Bitcoin through faster transactions and lower fees, and this strategy is clearly paying off. are.
However, caution is advised given the trend in early September, where LTC mirrored the decline in BTC.
Read Litecoin (LTC) price prediction for 2024-2025
Overall, if Litecoin continues to attract traders’ interest, it could move closer to the previous rejection point at $76.
Conversely, if Bitcoin’s volatility overwhelms LTC’s rise, the price could swing back towards $50.
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