Litecoin [LTC] investors should watch out for these short-term price levels

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-Litecoin suffered a major blow to its price action in the last five days courtesy of a massive FUD-induced sell-off. It dropped as low as $74 for the first time since December 2020, but the dip provided a nice discount for those looking to ride the recovery wave.

-If you are among those who purchased Litecoin near the low of 9 May, you might also be looking to cash out at a healthy level before additional downside. However, we will have to evaluate Litecoins price action in order to understand which levels will likely yield resistance on the way up.

-Litecoin dropped by 45% from its March top at $134, to its latest low at $81.29, at the time of writing. However, it was up by 0.07% in the last 24 hours.

-Mapping Fibonacci levels using the two price points reveals that bulls latest attempt to recover already seems to have pulled back after encountering resistance near the $0.618 Fibonacci level.

-The next Fibonacci retracement levels to look out for in the short term include 0.272 and the 0 level. These Fibonacci levels align with the $95.83 and $103.99 price levels respectively in case of a short-term rally by as much as 40%.

-An additional downside is still possible if the sell-off continues but should be offset by accumulation at lower prices. This might be what is happening with Litecoin considering its heavily discounted price level.

-Most LTC holders are currently in the red according to the MVRV ratio. There is more incentive to buy at lower prices than to sell at a loss.

-Interestingly, LTC registered an increase in the number of active addresses since 8 May. This is likely a sign of healthy accumulation and it reflects the price uptick in the last 24 hours.

-It seems LTC is headed for some bullish recovery within the next few weeks. However, investors should be cautious of the potential for an extended crash.

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