Lighter Surges 15%: Can $6.25M in Whale Buys Help LIT Reach $4?

Lighter (LIT) has rebounded strongly after a sharp decline, with whales accumulating significant amounts of the cryptocurrency. This purchasing activity is raising questions about LIT's potential to reach the $4 mark. As market conditions evolve, we examine the impact of whale buying, retail selling, and momentum indicators.

Key Takeaways

Lighter (LIT) price rose 15.48% after recovering from a 30% drop.
Whale purchases totaling $6.25 million indicate increased interest in LIT.
Retail sellers are taking profits, creating potential downward pressure.
Momentum indicators are signaling that LIT could continue to rise, targeting $4, but risks remain.

Lighter: Can $6mln Whale Buys Boost LIT to Reach $4 Target?

Recent Price Recovery

After dropping over 30% from its all-time high last week, Lighter (LIT) has shown a robust recovery. The altcoin found support at $2.5 before climbing by 18% to reach a high of $3.2, followed by a slight pullback. As of now, LIT is trading at approximately $3.0, reflecting a daily gain of 15.48%. Meanwhile, trading volume increased by 79% to $35 million, with its market capitalization surpassing $700 million, indicating fresh capital inflows.

Whale Activity in the Market

In this renewed market momentum, notable investors—particularly whales—have been actively pursuing LIT. Data from Onchain reveals that one whale sold 52.1 Wrapped Bitcoin (WBTC) for $4.86 million and subsequently deposited $3.36 million in USDC into Lighter. This whale then bought 1,119,001 LIT tokens at an average price of $3. Following this, another whale transferred $2.89 million in USDC, acquiring 991,458 LIT at $2.92. Overall, these two whales have invested $6.25 million into LIT, amassing a total of 2 million tokens.

The level of whale activity isn't limited to these transactions. Analysis from the Whale Hunter metric on TradingView indicates persistent whale accumulation at lower price levels, suggesting that they are systematically absorbing selling pressure during price corrections.

Lighter whale hunter & buyer seller strength

Retail Sellers Taking Profits

As LIT marks a recovery from its earlier declines, many earlier buyers have opted to cash out, surprising market analysts. Current buyer-seller strength metrics indicate that the market is in a distribution phase. Each significant price increase prompts aggressive selling from investors.

Presently, the selling strength stands at +39, while the buying strength sits in the negative territory at -60, pointing towards higher selling pressure. Despite some buyers showing readiness to enter the market at existing prices, sellers demonstrate stronger resolve, leaving LIT vulnerable to further retracement, particularly if buyers cannot counteract selling pressure effectively.

Is LIT Ready for Further Gains?

The rebound in Lighter is largely attributed to whale participation, who have been buying during price corrections, thus contributing to LIT’s upward trend. Currently, LIT’s Relative Strength Index (RSI) has reached 90, indicating it is in overbought territory. Additionally, the Relative Vigor Index (RVGI) has escalated to 0.007, following a bullish crossover.

LIT RSI & RVGI

High readings in these momentum indicators imply strong demand and buying pressure, positioning LIT favorably for potential further gains. If whale support continues, Lighter could break past the $3.5 threshold and aim for $4. Conversely, if profit-taking accelerates among holders, the price could breach the $3 support level, seeking a return to the $2.5 range.

Conclusion

The developments surrounding Lighter present an intriguing narrative in the cryptocurrency market. Whale accumulation amidst retail selling creates a dynamic that could propel LIT to new heights, yet risks remain that could lead to a pullback. Observing market trends will be crucial for investors as they navigate the current landscape of LIT.