Litecoin (LTC) Holds Key Support as ETF News Sparks Breakout Potential

Litecoin (LTC) is at a critical juncture following the SEC’s acknowledgment of Grayscale’s LTC ETF filing. This development has renewed investor interest, as institutional adoption through an ETF could significantly impact LTC’s market dynamics. However, the technical outlook shows LTC navigating a corrective phase, with signs of a potential breakout forming.

SEC To Consider Grayscale’s LTC ETF

The SEC’s acknowledgment of Grayscale’s Litecoin (LTC) ETF filing has introduced a key development that could impact LTC’s price trajectory. Regulatory advancements in ETFs often fuel institutional interest, leading to increased market activity. While this announcement does not guarantee approval, it indicates a more favorable stance toward crypto assets like Litecoin, which have historically faced regulatory scrutiny.

From a technical perspective, LTC is currently consolidating within a corrective phase, with key resistance at $82.95 and major support at $70. The ETF news could serve as a catalyst for a breakout, potentially targeting higher Fibonacci extensions near $96.81. However, if bullish momentum fails, a retest of lower supports around $70 remains possible.

Traders should monitor LTC’s reaction to this news, with volume spikes and RSI trends providing crucial confirmation of a breakout. While ETF speculation may drive short-term price action, sustained gains will depend on broader market sentiment and investor confidence.

LTC Price Analysis 

The daily LTC chart shows a completed five-wave impulse rally that peaked at $147.76 on Dec. 5, followed by a prolonged A-B-C correction. This corrective wave structure found strong support at $82.95, aligning with the 0.786 Fibonacci retracement, which is historically a significant reversal zone. The latest price action indicates that LTC has stabilized near $105, sitting around the 0.5 Fibonacci retracement, suggesting a potential accumulation phase.

Additionally, a descending trendline has been capping price action, acting as dynamic resistance. A break above this trendline, currently near $128.30 (0.236 Fib), would confirm a shift from the correction into a new bullish phase. The daily Relative Strength Index (RSI) is gradually recovering from oversold conditions, indicating a potential rise in buying momentum. However, for sustained upside, LTC needs to reclaim $128, which would clear the way toward a retest of its prior highs.

If bearish pressure persists and LTC fails to maintain above $96.81 (0.618 Fib), a further drop to retest $82.95 remains possible. That level would serve as the last stronghold for bulls before a deeper retracement occurs. The volume profile also suggests a lack of significant buying pressure yet, meaning a breakout would require an increase in volume to validate the move.

LTC Price Prediction

The 1-hour chart provides a more granular view of LTC’s recent movements. A five-wave impulse structure appears to be forming after LTC found a local bottom near $82.95. Wave (i) completed at $109, and LTC is currently in wave (ii) consolidation, which is expected to provide the base for the next upward expansion.

A breakout above the $106 resistance could initiate wave (iii), targeting $116.26 (0.382 Fib) as the first significant hurdle. This level aligns with prior corrective highs, making it an important breakout confirmation point. If LTC clears this level with strong momentum, the next key targets would be $128.30 (0.236 Fib) and ultimately $147.76, where the previous high and full five-wave structure would complete.

However, failure to break above $106 could see LTC retesting lower supports. The 1-hour RSI is showing signs of a bullish divergence, suggesting a potential reversal is brewing, but volume remains a critical factor. If LTC dips back to $96.81, bulls must defend that level to maintain the structure’s integrity. A deeper retracement to $82.95 would indicate further weakness, potentially delaying the expected breakout.

Traders should monitor whether LTC can break above the $116.26 resistance, as this would confirm the beginning of a new bullish cycle. A strong rally could bring LTC back to the $140+ range, but sustained volume and a confirmed trend shift are necessary for further gains.

Key Levels to Watch

• Immediate Resistance: $106 (0.5 Fibonacci Retracement)
• Key Resistance: $116.26 (0.382 Fibonacci), $128.30 (0.236 Fibonacci)
• Critical Support: $96.81 (0.618 Fibonacci), $82.95 (0.786 Fibonacci)
• Bullish Target: $147.76 (Prior High)
• Bearish Invalidation: Below $82.95 (Break of Structural Support)