Litecoin (LTC) is under increasing pressure as the broader cryptocurrency market experiences a pullback. With a recent drop to around $123.31, a 3% decline in 24 hours, Litecoin’s momentum is fading, leaving many to wonder whether it’s heading for a deeper fall—potentially below the $100 mark.

Selling Pressure Weighs on Litecoin’s Price

Over the past 24 hours, the crypto market has seen a liquidation of nearly $250 million, contributing to a growing bearish sentiment in Litecoin. The surge in selling activity has raised concerns that Litecoin might test its next major support level near $98, potentially marking another downturn beneath the $100 threshold.

Litecoin’s price is currently trapped in a downtrend, trading at $123.31, but with increasing selling pressure, experts are speculating that it may continue to decline towards the $115 mark and ultimately dip lower.

Potential for a Major Drop: Litecoin’s Chart Pattern

Crypto analyst Ali Martinez has pointed to a concerning pattern in Litecoin’s daily chart. The cryptocurrency is forming a double-top reversal, signaling a potential for further decline. The mid-line near $115 has already been breached, with the next target for the bears potentially at $98, which is close to the lower band of the parallel channel.

If Litecoin fails to hold above the $115 mark, there’s a growing possibility that it could test the $98 support level, triggering a deeper plunge that could bring it under the $100 mark for the first time in a while.

A Shift in Sentiment: The Derivatives Market

Alongside this technical analysis, Litecoin’s derivatives market is showing a shift in sentiment. Over the past 24 hours, there has been a significant increase in bearish positions. The long-to-short ratio, which is used to measure trader sentiment, indicates that more traders are betting against Litecoin’s price, signaling that they expect the coin’s value to drop further.

However, despite the surge in short positions, the long-to-short ratio across major exchanges like Binance and OKExchange remains somewhat bullish. This suggests that optimism still exists among some traders, though the sentiment is starting to shift toward caution.

Moreover, Litecoin’s total liquidations for the past 24 hours have reached $3.23 million, with the majority of the losses coming from long positions. Even with this bearish sentiment, some traders are still willing to maintain their long positions, indicated by the funding rate for Litecoin’s open interest.

Network Growth Could Provide Relief for Litecoin

While short-term bearish pressure is evident, Litecoin has seen notable growth in its network. The number of addresses on the Litecoin blockchain has grown significantly, with a total of 8.24 million addresses as of now, compared to a 30-day average of 8.15 million. This uptick suggests that there is increasing demand for Litecoin, potentially providing a strong foundation for future price growth.

Transaction volume on the Litecoin network has also surged. In the past six months, the total transaction volume has grown from $3.74 billion to $11.37 billion, a sign of the cryptocurrency’s continued adoption and usage.

This network growth could help offset some of the negative market pressures, potentially creating a buying opportunity at the $98 support level. Litecoin’s growing address base and transaction volume demonstrate that, despite its price struggles, there is continued interest in the network.

Conclusion: What’s Next for Litecoin?

As the broader market correction continues, Litecoin faces a potential drop to the $100 mark, with some analysts predicting a further decline to $98. However, the cryptocurrency’s increasing network growth and rising transaction volumes suggest that it has a solid foundation to bounce back.

The current downturn presents a buying opportunity for those looking to enter at a lower price point. The key support level to watch is $98, with a potential breakout target around the $138 level if Litecoin can recover from its current slump.

With the shift in market sentiment and increased liquidation activity, the next few days could be crucial in determining whether Litecoin will stabilize or continue its downward trend. For now, traders and investors alike should keep a close eye on Litecoin’s performance as it navigates through this volatile period.