Litecoin price broke out above its 3 months ascending channel. This is very Bullish for Litecoin price which will now benefit from even more positive investors’ attention.
When we published our artivle yesterday, we mentioned that Litecoin price is set up to benefit from 3 factors: An awesome chart set up, which is supported by an all time high in transactions, a strengthening community and a superior scalability.
Uncertainty was good for Litecoin price and will probably continue to be as scalability issues remain a challenge with other Crypto currencies. Litecoin is also set now to benefit from the advantages of the Lightning Network. These advantages include:
- Reduced fees: Users will only need to pay an opening and closing fee Versus multiple transaction fees.
- Atomic Swaps: Safely swaping of one cryptocurrency for another without the need for an exchange.
Today, the Litecoin foundation and Charlie Lee announced the first Lightning Network based Litecoin transaction
This is an important step for Litecoin as a currency and for the community. Atomic swaps will increase the demand on Litecoin and drive Litecoin price higher. The volume is rising as we write this article, with most transactions in Chinese Yuan.
Rising volume is likely to continue as the Segwit related uncertainty keeps rising. Today, Chinese mining pool F2Pool announced they no longer supports Segwit2x.
So while we will definitely continue keeping an eye on the Segwit progress, the strength of the chart is what gives us confidence that the strength of the price action will continue. The chart below shows how today, the price broke above the 3 months ascending channel with authority. This represents a 24% increase in 24 hours.
Given how fast this move was, it is to be expected that profit taking will take place. We might see a backtest of the top of the channel which should now act as a support. Right now, it is very likely that we see $100 and maybe above before a backtest.