The US dollar index jumped to the highest level in five months.
The rally happened as the US economic growth continued.
Cryptocurrencies like Litecoin have an inverse relationship with the USD.
Litecoin and other cryptocurrency prices have come under scrutiny after last week’s events. On Wednesday, the Securities and Exchange Commission (SEC) suffered a major blow when Greyscale won a major case in the US.
The victory means that the SEC will likely approve the launch of spot Bitcoin ETFs. While coins like BTC and LTC jumped after the news, their rallies fizzled after the SEC decided to delay a decision on funds by companies like Blackrock and Invesco.
Litecoin investors are watching these events closely because of the close correlation that exists between BTC and LTC. For one, Litecoin was created from a Bitcoin folk.
Therefore, if Bitcoin succeeds in having a spot ETF, there is a high possibility that a Litecoin will also have its ETF shortly afterward.
The other big event moving Litecoin is the strong performance of the US dollar. The dollar index jumped to $104.5, which was the highest level in more than 5 months. It has soared by more than 5.25% from the lowest level this year.
The index has risen because of the strength of the American economy. Recent data shows that countries like China and Germany are struggling. At the same time, the Fed has hiked rates to the highest level in more than two decades.
Therefore, Litecoin price will likely have a bearish breakout as sellers target the next support level at $55.
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