Bullish signals and rising sentiment drive LTC upward while traders await the SEC’s crucial ETF ruling.

Litecoin (LTC), often dubbed the “digital silver,” is showing signs of a bullish reversal just as the U.S. Securities and Exchange Commission (SEC) prepares to rule on a potential spot ETF. After dipping below $70 in early April, LTC has steadily climbed, forming a structure of higher lows on the daily chart. The price now trades within an ascending channel, hinting at a breakout if momentum continues.

The $100 mark remains a strong psychological barrier, but the bullish setup has traders optimistic. The timing couldn’t be more crucial, as a positive regulatory decision could act as the spark LTC needs to enter a new phase of price discovery.

Momentum Indicators Point to Strength

Technical indicators add weight to Litecoin’s improving outlook. The Chaikin Money Flow (CMF), which dipped into negative territory, is now hovering near the zero line. This suggests buying pressure is returning to the market.

Further support comes from the Relative Strength Index (RSI), currently sitting at 58.49. This reading leans towards bullish momentum but stays below the overbought threshold, leaving room for more upside. As long as LTC holds its support near $81.43, the next resistance level at $94.63 could be tested soon.

Sentiment Shifts in Litecoin’s Favour

On the sentiment front, things are looking brighter. Data from Santiment shows that Litecoin’s Weighted Sentiment, which was in negative territory just two days ago, has now climbed to 0.29. This metric blends social volume with emotional tone, offering insight into crowd psychology.

A positive score suggests growing confidence among investors and traders, possibly driven by hopes of ETF approval. If the SEC gives the green light to Canary Capital’s Litecoin ETF, sentiment may further improve, strengthening the case for a sustained rally.

ETF Verdict Could Unlock Next Leg Up

Historical patterns add another layer of intrigue. The Pi Cycle Top indicator, known for accurately flagging previous bull market peaks, shows no sign of an overheated market. The 111-day moving average currently stands at $100.96, acting as a short-term target. Should bullish conditions continue, LTC could rally to the 350-day MA at $172—a target seen only in a strong uptrend.

However, this optimistic scenario hinges on the SEC’s ETF decision. If approval is granted, Litecoin could break above key resistance levels and head into a higher trading range. But a rejection or delay might stall the rally, potentially dragging the price back below $70.