Litecoin (LTC) heads towards the $50 mark as investors suffer significant losses

After a week of sweeping sell-offs across the entire cryptocurrency market, Litecoin holders are facing increasing pressure. This Bitcoin “forked” currency has lost approximately $1.81 billion in market capitalization since the beginning of the year, officially dropping out of the top 20 largest digital assets by market value.

This negative development occurs alongside ominous signals from the Litecoin Network Realized Profit/Loss indicator, which shows investors continuously realizing losses since December. In recent days, the network has recorded nearly $40 million in realized losses.

Moreover, the Market Value to Realized Value (MVRV) ratio—an indicator reflecting the average profit/loss of all holders—indicates that Litecoin holders are bearing an average loss of up to approximately 40% of their portfolios.

Historically, when the MVRV drops to such low levels after a prolonged period of losses, it often opens up opportunities for a significant recovery. However, if overall market sentiment does not improve soon, the risk of entering a new phase of realized losses remains.

LTC MVRV | Source: SantimentIn the derivatives market, the outlook is also not very bright, as Litecoin’s open interest (OI) continues to weaken, retreating to around $350 million, while the funding rate remains in negative territory. Open interest reflects the total value of outstanding derivative contracts, and the funding rate is the periodic payment between traders to keep the perpetual contract price aligned with the spot market.

LTC Open Contract Volume | Source: Coinglass## Litecoin Price Forecast: LTC Rejected at $57, Heading Toward $50 Support

Litecoin faced strong resistance around $56.4 in recent sessions and is now gradually sliding toward the psychological support level of $50. In a negative scenario, if the $50 support is broken, this altcoin could continue to decline to find a new equilibrium at the bottom formed on Friday, around $45—its lowest point since June 2022.

Daily LTC/USDT Chart | Source: TradingViewOn the other hand, successfully overcoming the resistance zone at $56.4 could open up recovery opportunities for LTC, with the immediate target being to test the 20-day Exponential Moving Average (EMA).

From a technical perspective, the Relative Strength Index (RSI) is deep into oversold territory, while the Stochastic Oscillator (Stoch) remains below the neutral threshold, indicating selling pressure still dominates and the downtrend shows no signs of weakening.

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