Bitcoin News Today: Litecoin's $85 Support Test: Institutional Inflows vs. Bitcoin-Linked Volatility

Litecoin (LTC) has rebounded sharply from a critical support level of $85, sparking renewed optimism among traders as technical indicators and institutional inflows suggest a potential bullish reversal. The cryptocurrency's price surged 1.11% to $87.10 after hitting oversold RSI levels, with analysts highlighting the $85 threshold as a pivotal marker for short-term direction. A sustained close above this level could propel LTC toward resistance targets at $90.95 and $93.36, while a breakdown could trigger a retest of $79.86, according to a Coinpedia report.

Institutional confidence has bolstered the rally, with $855,000 in ETF inflows on November 3 signaling renewed market participation. This influx, coupled with rising retail activity, has pushed daily trading volume to $1.03 billion, albeit a 5.01% decline from prior peaks. Active Litecoin addresses have surged, outpacing rivals like Zcash (ZEC) in on-chain activity, while futures open interest continues to climb, according to AmbCrypto. Analysts note that the convergence of institutional and retail demand historically strengthens price momentum, particularly when both groups align in buying pressure, according to a Yahoo Finance report.

Technical analysis further supports the bullish case. The RSI has exited oversold territory, hovering near 35.92, while the MACD histogram shows waning bearish momentum. On the 4-hour chart, LTC has rebounded from the lower Bollinger Band and a horizontal support line, suggesting sellers may be exhausted. However, traders remain cautious, as a sharp drop in volume or profit-taking could extend consolidation before a breakout, Coinpedia noted.

The recent approval of the first U.S. Litecoin ETF has added fuel to the rally. Canary's LTCC fund, which began trading on October 28, attracted $1.65 million in inflows during its first week, though its performance lags behind newly launched Solana and Hedera ETFs. Meanwhile, Litecoin's correlation with Bitcoin (BTC) remains a double-edged sword, as BTC ETFs saw $191 million in net outflows on Friday, dragging down broader crypto sentiment.

Retail adoption also appears to be gaining traction. Stake.com, a major crypto gaming platform, now accounts for 16% of daily Litecoin on-chain transactions, highlighting the coin's utility in microtransactions. With median fees below $0.0005, LTC remains one of the cheapest networks for high-volume payments, a factor analysts say could drive further adoption in emerging markets.

Despite the positive signs, risks persist. The $85 support remains fragile, and a failure to hold above this level could reignite bearish sentiment. Additionally, broader market volatility, including Bitcoin's ETF struggles, could weigh on LTC's momentum. Analysts urge traders to monitor volume trends, RSI divergence, and institutional inflow sustainability to gauge the likelihood of a sustained rally.