Litecoin (LTC) Jumps 10% Despite U.S. Securities and Exchange Commission (SEC) Delay in Approving Bitcoin and Crypto ETFS

Against gloomy predictions following the U.S. Securities and Exchange Commission's (SEC) delay in authorising spot Bitcoin and crypto ETFS, Litecoin (LTC) surprisingly jumped by 10% over the weekend.

Clocking in a 10% weekend surge, Litecoin (LTC) stood out in a largely flat or declining altcoin market, sparking curiosity about what drove the unexpected rally amid the U.S. Securities and Exchange Commission’s (SEC) rejection of spot Bitcoin and crypto ETFS.

Litecoin Surges Despite SEC Setbacks

The SEC’s decision to delay approving several spot ETFs, including ones linked to Bitcoin and Ethereum, had cast a gloomy shadow over the cryptocurrency market earlier in the week. Past instances have seen such refusals cause brief drops in prices and investor confidence.

However, most altcoins remained in a tight range throughout the weekend, displaying limited volatility. Yet, Litecoin managed to break out of the mold and clocked in a surprising 10% over the weekend.

This move is interesting because it occurred despite the lack of immediate impact on Litecoin from the SEC’s postponement—suggesting that the asset is riding a separate wave, influenced more by long-term optimism and the coin’s fundamentals.

Whale Activity and Technical Indicators Show Promise

On-chain data showed a surge in whale activity amid the price move. Large wallet addresses were seen quickly accumulating LTC, showcasing faith from big-money investors.

Technical charts, too, displayed positive signals. Having recently crossed its 50-day moving average, Litecoin sent buy signals to several algorithmic traders, indicating a possible short-term upside. The Relative Strength Index (RSI), too, held just below the overbought area, suggesting that there is still room for upward momentum before a correction becomes imminent.

Halving is Still Having After Effects

In August 2023, Litecoin underwent its third halving, reducing block rewards from 12.5 LTC to 6.25 LTC. Although the early price move following halving was muted, many observers now contend that LTC’s price performance is beginning to show the effects of the supply constraint.

With fewer coins in circulation and a rather stable demand base, Litecoin’s pricing dynamics are becoming increasingly tight, leading to swift price changes in response to shifts in demand, as seen this week.

Rotation in Markets and the ‘Safe Haven’ Effect

Another explanation for LTC’s surge could be market rotation. Some investors are shifting funds into "safer," more established coins as they become pessimistic about hyped-up tokens and ETF-sensitive assets.

Litecoin, with its decade-long history, minimal fees, and robust network uptime, fits the bill for conservative crypto investors seeking short-term outposts amid uncertainties.

Moreover, with Bitcoin being largely macro-driven and unpredictable in the short term, some traders view Litecoin as a hedge, offering comparable transactional value and liquidity without the ETF noise, rendering it an interesting pivot for those seeking to minimize portfolio variance.

What’s Next For LTC?

Although the price move is positive, analysts caution that the crypto market is still volatile, and Litecoin has a past of brief, exuberant rallies followed by sharp downturns. Important resistance levels will be closely watched in the coming days, particularly between $100 and $105.

However, this move has sparked fresh interest in a coin that is sometimes overlooked in the broader crypto narrative. If sentiment persists and external macro factors don’t drastically shift, Litecoin might be setting itself up for a higher-than-anticipated Q2.