Litecoin price prediction: Up to $200 or down to $150?

The Litecoin (LTC/USD) price has rallied in the past few weeks helped by the resurgence of Bitcoin. The coin jumped to a multi-month high of $170.92, which was the highest level since June 18. Its market capitalisation has jumped to more than $10.8 billion.

Litecoin rebound accelerates

Litecoin is one of the oldest blockchain projects in the world. The coin was created by Charlie Lee as he tried to address the scalability of Bitcoin. Today, Litecoin is a cryptocurrency that is used as a means of exchange. Its fans use it to avoid the congestion in the Bitcoin ecosystem and the relatively higher cost. However, only a small number of people use the coin for these transactions.

Litecoin is also known for its close correlation with Bitcoin. As Charlie Lee recently said, most people buy LTC as a proxy for Bitcoin. Furthermore, one LTC costs about $170 while Bitcoin is going for more than $45,000. As shown below, the two coins have moved in the same direction in the past five years.

Therefore, to understand why Litecoin price has rebounded, we need to look at the price action of Bitcoin. Analysts believe that BTC price rallied as inflation expectations declined and US bond yields declined. As such, investors believe that the Federal Reserve will maintain its easy money policy for longer as the Delta variant continues spreading.

The price also rallied after it became clear that cryptocurrencies have some allies in the Senate. In an interview with CNBC, FTX CEO said:

Litecoin price prediction

The four-hour chart shows that the LTC price has been in a strong bullish trend lately. Along the way, the coin rose above the key resistance at $150, which was the highest level on July 29 and August 1. Further, the coin is being supported by the 25-day and 50-day moving averages. It is also along the upper side of the Bollinger Bands. 

Therefore, the Litecoin price will maintain the bullish momentum as bulls target the next key resistance at $200. This view will be invalidated if the price retreats below the support at $150.