- LTC price has crashed by over 26% from the highest point this year.
- A break below the current support will push the coin to the next price at $65.
- The Federal Reserve will deliver its interest rate decision later Wednesday.
Litecoin price has been stuck at the same point this week as investors waited cautiously for the upcoming Fed interest rate decision. The LTC price was trading at $77.81, the lowest level since May 10th. The coin has dropped by more than 26% from the highest level this year.
Litecoin halving countdown
There are three main things that will likely affect Litecoin price in the next few months. First, like all cryptocurrencies, LTC price will react to the regulatory concerns from the United States and the UK. The US has embarked on a regulatory strategy that involves litigation. Regulators argue that the US does not need any more crypto-focused laws. Instead, they believe that the existing securities law apply to both crypto and other assets.
Second, Litecoin price will react to the upcoming interest rate decision by the Federal Reserve scheduled for Wednesday. Economists polled by Reuters believe that the Fed will decide to leave interest rates unchanged for the first time in ten meetings. In his statement, Jerome Powell will likely argue that the pause will give the bank a chance to assess the impact of the last hikes.
A hawkish tone will likely mean more trouble for Litecoin and other cryptocurrencies. On the other hand, a dovish tone will likely push cryptocurrencies and stock prices higher.
Finally, the third important Litecoin catalyst is the upcoming halving event. As I wrote in this report, halving is a situation where the the block rewards to miners are reduced by half. It happens in most proof-of-work cryptocurrencies like Bitcoin and Ravencoin.
Historically, cryptocurrencies tend to rally ahead of the halving event since it usually leads to lower supply. Litecoin’s halving will happen on August 2nd of this year.
Litecoin price prediction
The daily chart shows that LTC price found a major barrier between the resistance level at $97.64 and $105. It has struggled moving above these levels several times this year. The coin has now found an important support slightly below $80. It has formed what looks like a double-bottom pattern, which is usually a bullish sign. The neckline of this pattern is at $97.64.
On the negative side, the 25-day and 50-day exponential moving averages (EMA) have made a bearish crossover. Therefore, a drop below this level will signal that there are more sellers in the market. It will open the possibility of the coin breaking to the next support level at $65.60, which is about 15% below the current level.
