Lighter up 12% after 2.5 mln buy: Can LIT stay above $1?

The decentralized exchange (DEX) narrative is slowly back on its feet this week. Lighter [LIT] is among the trending tokens in this sector, pulling more than 12% in daily gains.

However, it remains a question if bulls can keep on buying, pushing LIT even higher.

What’s the charging price of LIT today?

Whales’ leveraged purchases and a surge in DEX sector discussions drove the 12% gains.

For instance, a whale purchased a 5x leverage long position of 2.5 million LIT tokens at an average price of $0.9184. This purchase potentially fueled the rally that broke above $1.

This pushed the position higher, above the liquidation price of $0.8566.

The whale is currently sitting at an unrealized profit of more than $493K, with the position value at $2.789 million. In the same way, there were other smart traders that were accumulating the token.

Additionally, there was capital rotation toward DEX tokens like EDGE as mentions spiked across social platforms like X. For instance, EdgeX [EDGE], which lost more than 10% in the past 24 hours, recovered and rose 4%.

Furthermore, liquidation of shorts that were between $1.069 and $1.10 accelerated the upward move. Denser clusters had formed between $1.11 and $1.18, suggesting the price may shift to tap into this sell-side liquidity.

On the flip side, long liquidation leverage was forming just below the $1 level. However, the liquidity cluster was light. Can bulls defend the price against tapping into this level again?

Lighter bulls’ interest rises alongside price

The price action chart showed that Lighter price had been making higher highs (HH) since late March. Every breach of an HH was met with a correction that ended at a retest zone.

The hourly chart depicted that the altcoin was respecting an ascending trendline, with the price now approaching the previous HH at $1.13. A break above it could set LIT toward the $1.18 liquidity cluster.

Meanwhile, the Open Interest (OI) for the LIT/USDT pair on Binance perpetual contracts rose from $25 million to $31 million. Furthermore, the net volume jumped to a daily high of 1.22 million LIT tokens but has since retraced almost fully, suggesting profit-taking.

That explains why the prices were hovering around $1.13. But bulls’ interest was up with price even though OI was forming a double top.

Conversely, a rejection may push LIT back to the slanting trendline support or at least 50% of the move from $0.97. The $1.05 level may also act as a buy wall.

Final Summary 

• Lighter rallies 12% amid capital rotation to DEX tokens, whale buying, mentions on social media, and short liquidations.
• LIT faces a test at $1.13, which will determine if the altcoin can reach $1.18.