On July 4th, litecoin broke through and closed above $50 for the first time ever. Coincidentally, this notable achievement for cryptocurrency bulls just happened to occur on Independence Day in the United States. Symbolic, perhaps.
If you've been following my steemit account since I joined a few weeks ago, you'll know that my first market commentary was about litecoin. Therein, I noted that the $50 level was the key resistance price for bulls to overcome and asked the simple question: "Will litecoin finally breakout above $50?" In just under two weeks, it has.
When trading or assuming longer term speculative positions in cryptos, it's important to keep in mind that they are highly volatile and it's not out of the norm to see prices swing in the double digits in percentage terms. As the chart above conveys, litecoin clearly fits this description.
Just over a week ago, litecoin retested its previous $34 breakout level for the second time. Bulls overcame selling pressure from the bears and assertively defended that support zone. In my price action analysis at the time, I noted that the chart suggested that "a daily close above $42 is needed for bulls to see further upside in the near term."
As pointed out on the chart above, bulls finally achieved a close above $42 again on July 3rd. Litecoin subsequently ran higher to close above $50 the next day at $54.59, and trading as high as $55.47 since then.
In my opinion, a blue sky breakout appears to be in play for litecoin. The $50 level was a line in the sand for bulls to overcome and they have done so forcefully, as yesterday's large green candle on the daily chart depicts. The weekly chart for litecoin shows the progressively stronger interest it has attracted from buyers in the crypto market over the past few months.
At current price levels, litecoin's market valuation is just under $3B, which is about 1/15th of bitcoin's $42B market capitalization. In the world of cryptocurrencies, litecoin ranks number four among the top five in terms of valuation.
I will pose this question to the steemit community: if interest in litecoin continues to grow, how high do you see its price rising and do you expect its valuation to surpass ethereum's and/or bitcoin's someday?
My view is that the $100 price level is within reach now that $50 has been surpassed, assuming bullish momentum persists. As far as market valuation is concerned, litecoin would need to first exceed the $10B mark - it's not far fetched to see this happening in the future, considering that the adoption of litecoin in the Asian markets is now picking up.
Share your thoughts in the comments below!