Litecoin’s price has fallen alongside that of all cryptocurrency assets this year, losing roughly 48% since reaching an all-time high in December 2021.
TradingBeasts has an extremely negative outlook for Litecoin over both its short- and long-term forecast horizon, believing its price and market cap to track Bitcoin’s price fluctuations.
What is Litecoin?
Litecoin, created in October 2011 by former Google employee Charlie Lee, is a peer-to-peer cryptocurrency designed as an alternative to Bitcoin that processes transactions faster and with lower transaction costs.
As with other cryptocurrencies, Litecoin utilizes blockchain technology to record and verify transactions across its decentralized network. Miners use immense computing power to solve complex mathematical puzzles in order to verify and add these transactions onto the blockchain.
Litecoin can be purchased and sold on crypto exchanges, where investors can buy and sell cryptocurrency using fiat money (such as dollars) or digital tokens like Ethereum. Investors should always conduct their own research before investing in any asset class; cryptocurrency exchanges often provide tools to assist users manage investments and protect their assets – for instance 2-factor authentication (2FA), which helps prevent unauthorized access.
How to Trade Litecoin
Litecoin is one of the many cryptocurrencies you can trade using a CFD trading platform for profit. Like other cryptocurrencies, its value fluctuates depending on demand for digital assets like this, market forces, supply constraints and other factors affecting supply and demand; sometimes being called “Bitcoin’s Silver”. As one of its first spinoffs Litecoin has often been called “The Silver to Bitcoin’s Gold”.
IG trading platforms feature an array of technical analysis tools that you can use to help identify trends and plan trades. For example, the Litecoin chart features a Bollinger Bands indicator which uses two lateral bands sandwiched by a middle moving average line to assess volatility and detect potentially overbought or oversold market conditions.
To trade Litecoin, first open an account with an exchange or broker. After opening this account, fund it via bank transfer or e-wallets and start purchasing LTC from them.
Investing in Litecoin
When investing in Litecoin, the ideal way is through a reliable cryptocurrency broker. Look for platforms offering different payment modes like cash, bank transfers, credit cards and e-wallets as well as cryptocurrency.
Be sure to use a platform with secure storage options for your cryptocurrency assets, like eToro which allows users to buy and sell crypto with their local currency as well as providing a non-custodial wallet for coins.
Investing in Litecoin entails all the risks inherent to investing in any new asset class, with cryptocurrencies being particularly risky due to their volatile price movements and large price swings overnight. Investors should only trade with money they can afford to lose and use hedging techniques like collars to mitigate risk. Furthermore, as it is still not widely used it could face competition from other digital currencies in the future, potentially diminishing its value over time. Furthermore, governments are still in the process of regulating this space with new regulations leading to large price shifts across cryptocurrencies as a whole.
Trading Litecoin
Are You Looking to Benefit From the Price Fluctuations of Litecoin? IG Trading makes it possible! By trading CFDs, not actually purchasing or selling LTC, but opening contracts that pay you any upward price movements and incur losses when they decline.
Buy actual Litecoin coins on exchanges as long-term investments; just remember the security measures outlined in our Cryptocurrency Trading Guide and always protect your private keys.
Technical analysis can also help you speculate on Litecoin’s price, providing another avenue of speculation. For instance, using the Relative Strength Index (RSI) can assist you in analyzing market conditions and recognizing overbought/oversold levels to enable short and long positions respectively on Litecoin. Ensure you test any strategies before investing real money for optimal success!
