The Terra price has been on the slide for six straight days. As a result, the LUNA token has given back all of the October gains. Nonetheless, the bulls will be encouraged that Terra (LUNA) is holding the trend channel in place from July.
Terra, the stable-coin powered payments protocol, surged 930% from the July $5.52 low to over $50.00 last week. The impressive three-month rally slingshot Terra’s native LUNA token to a $19.4 Billion market cap, making it one of the world’s largest cryptocurrencies.
Even in light of the recent pullback, Terra is valued at $14.6 Billion, ranking it as the 12th-largest Crypto, behind Uniswap (UNI). However, altcoin’s in general, are showing signs of stress, which has encouraged profit-taking in Terra. Subsequently, the LUNA price is under heavy fire, threatening the bullish momentum.
The daily chart shows Terra has been trending higher since the middle of July. LUNA is still in trend despite the recent weakness, although heading towards the lower edge at $32.00. A series of lows in late September align with the rising trend line to create robust confluent support. Furthermore, ahead of the trend, the 50-day moving average (DMA) at $35.90 reinforces the scale-down support.
However, The Relative Strength Index (RSI) is trending lower, suggesting the price may soon test the validity of the rising trend channel. As long as the LUNA price holds above $32.00, the ascending trend should dominate the price action, encouraging dip-buying.
On the other hand, if capital continues to be pulled from altcoins, the LUNA token may lose the uptrend. If the price slips below $32.00, it may encourage profitable longs to lock in profits, triggering an exaggerated decline. In that event, strong support should be found between the 21st of September low of $23.62 and the 100 DMA at $24.82.
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This post was last modified on Oct 13, 2021, 10:39 BST 10:39