Litecoin is in a strong bullish phase with capital flowing into the derivatives market reaching 437 million USD in 24 hours, aiming to establish a new peak for 2025.
Technical signals indicate the possibility of a slight correction for Litecoin, although capital flows and buying momentum remain strong. Investors need to be cautious of risks when the derivatives market features many still-active sell orders.
MAIN CONTENT
Litecoin has recorded a surge in derivative capital flows, signaling a dominant upward trend in 2025.
Technical indicators such as RSI and Aroon indicate that LTC may experience a short-term correction before establishing a new peak.
Strong resistance zones and pending sell orders pose a correction risk, warning investors to closely monitor market fluctuations.
Is Litecoin (LTC) experiencing an impressive price increase in 2025?
Litecoin has entered one of the strongest bullish phases in recent months, aiming to establish a new peak for 2025 based on strong capital flows from the derivatives market.
Data from CoinGlass shows that in the past 24 hours, the Litecoin derivatives market recorded up to 437 million USD of new capital - demonstrating LTC's allure amidst a backdrop of many major cryptocurrencies being stagnant.
The Litecoin derivatives market has never witnessed such impressive capital flow surges as it has recently.
According to the CoinGlass report on August 5, 2025.
The strong buying trend and interest from large institutions create a foundation for the Litecoin market to grow. However, with many large sell orders still in effect, a short-term price correction scenario may still occur if buying pressure is not maintained.
What does the surge in liquidity and trading volume of Litecoin signify?
Trading volume and liquidity in the market have accelerated, opening up the possibility of pushing LTC prices to new highs.
An additional 437 million USD flowing into the derivatives market in just one day reflects investor confidence in Litecoin's growth prospects.
The capital influx shows that traders are betting heavily on the next price increase of LTC.
Insight from AMBCrypto on August 5, 2025.
In addition, the increase in trading volume helps mitigate liquidity risks and reinforces confidence in LTC's ability to withstand potential sell-offs. However, investors still need to be cautious of unexpected profit-taking activities from whales when buying momentum begins to weaken.
Why is the strength of long orders in the LTC derivatives market prevailing?
In the past 24 hours, short positions in Litecoin derivatives have suffered significant losses, totaling 3.48 million USD, while long positions recorded losses of only 524,790 USD. This indicates the superior strength of the buyers.
About 52% of the total trading volume in derivatives belongs to long orders, pushing the long/short ratio above 1 – implying that a significant bullish trend may form. The funding rate from exchanges has turned positive, reaching 0.0054%, confirming that investors are paying fees to hold long positions in a bullish market.
Maintaining a positive funding rate along with a clear advantage for the long side is often a signal that the market is about to experience strong movements in a positive direction.
CoinGlass, Funding Rate report, August 2025.
This raises the possibility that the Litecoin market will continue to explode unless there is a sudden crash from large sell orders. However, history has shown that prolonged positive funding rates are often accompanied by short-term corrections due to excessive FOMO waves.
Short positions are under significant pressure, what is the outlook for price reversal?
With total losses reaching 3.48 million USD from short positions, market sentiment is clearly leaning towards the possibility of a short-term bullish reversal.
History has shown that before strong surges, short-position investors often face liquidation when buying pressure is overwhelming. This scenario has previously helped LTC spike to short-term peaks, after which corrections occurred to absorb profit-taking orders.
What does the technical indicator on LTC warn about the risk of correction?
The RSI indicator (Relative Strength Index) indicates that LTC has entered the overbought zone after surpassing the 70 mark, warning of the potential for overbuying and possible exhaustion soon.
According to technical analysts, the RSI in the overbought zone is often accompanied by price corrections, although the timing of the reversal is not clearly defined. This prompts investors to proactively protect their positions before the market experiences an unexpected downward wave.
When RSI exceeds 70, market history records the likelihood of LTC undergoing a short-term correction, especially when profit-taking volume from large investors increases significantly.
AMBCrypto strategy report August 2025.
In addition to RSI, the Aroon indicator shows that Aroon Up reached 100% and Aroon Down maintains at 74%. Although the upward trend has not been broken, the narrowing gap between the two lines warns of a potential short-term reversal. If Aroon Up is crossed down by Aroon Down, the bearish trend signal will be clear.
What does the Aroon indicator reflect about the developing trend?
Aroon is a popular system for determining trend reversal points using two lines: Aroon Up (orange) and Aroon Down (green). When Aroon Up surpasses Aroon Down, the market is still controlled by the buyers.
At the time of the update, Aroon Up reached 100% while Aroon Down was at 74%. However, this gap is narrowing, implying that the upward force is weakening – if a reversal occurs, the adjustment will happen quickly and forcefully.
Litecoin has reached the supply zone – What is the significance and potential risks?
According to technical analysis, Litecoin has approached a strong supply/resistance zone – where it has previously caused LTC prices to reverse down twice in 2025. Notably, the most recent correction pulled LTC back to a low of 63.07 USD.
After today's strong surge, trading volume skyrocketed by 230%, reaching 1.97 billion USD across the market. This reinforces upward momentum. However, if selling volume in the supply zone overwhelms, LTC could sharply reverse to the nearest support level, likely triggering a liquidation wave of long positions as seen in previous instances.
August 2025 Parameters End of 2024 Peak Price 141.15 USD 147 USD 24h Trading Volume 1.97 billion USD 0.6 - 0.7 billion USD Funding Rate 0.0054% (positive) Negative or close to 0
Will LTC aim for new highs?
With impressive growth momentum and derivative capital flows, if selling pressure does not significantly impact prices, LTC could fully recover to the peak of 141.15 USD and approach the historical peak in December 2024 (147 USD).
However, if the supply zone continues to maintain heavy sell orders and whales start to take profits, the risk of LTC sharply reversing downwards according to previous scenarios is real – directly affecting long positions and triggering a significant liquidation wave.
How does the Litecoin derivatives market trend compare to other major cryptocurrencies?
Compared to Bitcoin and Ethereum, Litecoin's derivatives boom on August 5, 2025, is the most prominent in terms of capital flow growth rate.
Indicators such as funding rate, trading volume, and long/short ratio of Litecoin currently outperform other cryptocurrencies, indicating a concentration of capital flow and high expectations for LTC during this period.
The strong influx of capital into Litecoin derivatives indicates a temporary market shift away from Bitcoin and Ethereum towards other top cryptocurrencies, notably LTC.
Market analysis, CoinGlass update August 5, 2025.
The comparison table below shows the superiority of Litecoin compared to the two largest cryptocurrencies in the latest trading session:
Cryptocurrency Derivative Capital Flow (24h) Funding Rate Long/Short Ratio Litecoin 437 million USD 0.0054% (positive) >1 Bitcoin 215 million USD 0.0012% (positive) ≈1 Ethereum 160 million USD 0.0009% ≈1
This data helps investors accurately assess the role and superior appeal of Litecoin at this moment, although it is important to note potential correction risks if buying pressure weakens or capital flow reverses.
Overview assessment of price trends and risks for LTC investors
LTC is experiencing strong growth due to capital inflows from derivatives and institutional investments. However, overbought signals and the price nearing historical resistance levels present a challenge regarding profit-taking and short-term reversal.
Those holding long positions need to proactively manage risk, set flexible stop loss, and patiently wait for confirmation of a breakout above the resistance zone before increasing positions. Whales and institutional investors will play a significant role in determining the medium-term trend of Litecoin.
Rapid growth without sustainable liquidity and lacking confirmation above strong supply zones could put LTC at risk of a sudden deep correction.
Quoted from DeFi expert insights, AMBCrypto report August 2025.
Technical patterns, momentum indicators, and cash flow behaviors are useful tools for traders to proactively respond to fast reversals in the Litecoin derivatives market.
Frequently Asked Questions
What factors are driving LTC's strong price increase in 2025?
The sudden influx of capital into the derivatives market and the dominance of long orders are the main drivers helping LTC aim for the peak of 2025.
What is the biggest risk for LTC investors at this moment?
The emergence of strong resistance zones along with many pending sell orders could lead LTC to unexpectedly reverse sharply, especially if cash flow is quickly withdrawn.
Which technical indicator is warning of a short-term correction for LTC?
The RSI indicator has exceeded 70 (overbought) while Aroon signals a narrowing gap, warning of a potential technical correction that may occur soon.
What is the funding rate and its significance for LTC investors?
A positive funding rate indicates that the long side pays fees to hold positions, usually occurring when market sentiment is overly optimistic and accompanied by the potential for short-term corrections.
What is the difference between the LTC derivatives market and other major cryptocurrencies?
In the latest session, capital flow in derivatives and buying momentum on LTC surpassed that of Bitcoin and Ethereum when considering the long/short ratio and funding rate.
Can Litecoin regain its ATH levels at the end of 2024?
If the cash flow and upward momentum remain strong, LTC could recover to the peak of 141.15 USD and aim for the 147 USD level recorded at the end of 2024.
What should investors do to manage risk when the LTC market is too hot?
Discipline should be exercised in setting stop losses, closely monitoring cash flow momentum signals, and proactively reducing positions when reversal signals appear from technical indicators.
Source: https://tintucbitcoin.com/ltc-tang-manh-can-tro-nao-2025/
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