Loopring (LRC) has advanced more than 40% in less than twenty-four hours, rising from a low of $0.27 to a high of $0.42. The amount of LRC traded over the last several days saw an increase which meant that buying strength was recovering in the market. The current price of Loopring (LRC) stands at around $0.40, which is still more than 65% off from its 2022 highs that were registered in March.
But where is the price of Loopring (LRC) going next, and what we can expect from November 2022?
Today, Crypto Lists will discuss LRC price estimates from a technical and fundamental analysis perspective. Please note that there are also many other factors to consider when entering a position, such as your time horizon, willingness to risk, and how much margin you have if trading with leverage.
Cryptocurrencies soared on the back of a poor U.S. unemployment report
Loopring is an open-source exchange and payment protocol that allows low-cost trading and payment on Ethereum. The security and sovereignty of user assets are Loopring’s top priority, and it is important to mention that Loopring deployed the first zkRollup protocol on Ethereum, which does not rely on any external validators, consensus, or crypto-economic assumptions.
According to its official website, zkRollup is the most secure scaling mechanism the industry knows for now, and it enables users to access their assets in all circumstances. With zkRollups, Loopring asserts it can offer faster settlements for traders, and rather than settling trades on the Ethereum blockchain directly (as other decentralized exchanges do), zkRollups enables Loopring to complete key computations elsewhere.
zkRollups bundle hundreds of transfers into a single transaction, and it’s important to note that zkRollups are just one proposed way of making the Ethereum blockchain more suitable for DeFi applications. Each batch of transactions is then added to the Ethereum blockchain with zero-knowledge proofs that allow anyone to reconstruct the transactions that took place off-chain. This allows users to be confident that the transactions are genuine and that they have not been tampered with by any unwanted parties.
LRC is the utility token of Loopring protocol, and LRC incentivizes protocol-desirable behavior from insurers, liquidity providers, and DAO governors. LRC is necessary for key operations on the protocol, and anyone who wishes to operate a decentralized exchange on Loopring must lock up at least 250,000 LRC.
A recent surge
The price of LRC skyrocketed this Friday, and according to a recent survey by Fidelity Digital Assets, LRC still has room for the upside. Fidelity Digital Assets reported:
Institutional players are accumulating crypto despite the crypto bear market. At the end of the second half of 2022, 58% of the institutions surveyed were holding cryptocurrencies, a 6 percent increase from last year. Moreover, 78% were planning to tip their toes in crypto in the future.
The main reason for this is the conviction of the long-term upside potential of cryptocurrencies. Total crypto market capitalization has once again reached the all-important $1 trillion mark even though the U.S. central bank delivered a fourth straight 75-basis-point increase in its policy rate last Wednesday and signaled plans to push forward with the tightening cycle.
One of the reasons behind last Friday’s jump is the fact that many cryptocurrencies soared on the back of the poor U.S. unemployment report. Investors have once again witnessed the paradox of good “bad” news, and according to the well-established narrative, the rise of the cryptocurrency market was triggered by the assumption that for the U.S. central bank, rising unemployment could be an argument to revise its hawkish monetary policy and slow down the pace of the interest rate hikes.
Technical analysis for Loopring (LRC)
Loopring (LRC) advanced more than 40% in less than twenty-four hours, rising from a low of $0.27 to a high of $0.42. The current price of LRC at time of writing stands at around $0.40, which is still more than 65% off from its 2022 highs that were registered in March.
The chart below shows that LRC has been moving in a strong downtrend since November 2021, and even with the current jump, LRC remains under pressure when we look at a “bigger” picture.
Main support & resistance levels for Loopring (LRC)
On this chart (the period from April 2022), I marked the main support and resistance levels that can help traders to understand where the price could move. The risk of another decline for Loopring (LRC) is not over, but if the price advances above $0.50, the next target could be located around $0.60. The current support level is $0.35, and if the price breaks this level, it would be a “SELL” signal, and we have the open way to $0.30. If the price drops below $0.30, which represents very strong support, the next target could be located around $0.25 or even below.
What speaks for the rise in the Loopring (LRC) price
The amount of LRC traded over the last week has seen an increase, and if the price advances above the resistance that stands at $0.50, the next target could be located at around $0.60. According to a recent survey by Fidelity Digital Assets, institutional players are accumulating crypto despite the crypto bear market, and because of this, LRC still has room on the upside.
Traders should also consider that the price of Loopring (LRC) is correlated with Bitcoin, and if the price of Bitcoin jumps above $22000, we will likely see LRC at a higher price level than the current one.
What indicates a downward swing for Loopring (LRC)
Loopring (LRC) advanced more than 40% in less than twenty-four hours; still, traders should keep in mind that the price can easily return to the levels reached at the beginning of the last trading week. The current support level is $0.35, and if the price breaks this level, it would be a “SELL” signal, and we have the open way to $0.30. If the price drops below $0.30, which represents very strong support, the next target could be located around $0.25 or even below.
As the price of LRC is correlated with the price of BTC, if the price of BTC drops again below $20000 support, that would almost certainly have a negative influence on the price of LRC.
What analysts and experts say
Craig Erlam, a Senior Market Analyst at Oanda, said that the outlook for risk appetite in the near term is still not positive, and we would probably see another sell-off in the weeks ahead.
Disclaimer: Crypto is extremely volatile and not suitable for everyone to invest in. Never speculate with money that you cannot afford to lose. The information on this site is presented for educational purposes only and should not be construed as investment or financial advice.