Terra (LUNA) has been on a sluggish grind increased over the previous few months forming a rising channel within the course of. Will immediately’s retest of the lows maintain or will the bears break the sample?
The last time we looked at Terra (LUNA), the market was simply making new all-time highs above the $50 deal with on LUNA/USD, doubtless a bullish response to information of a coming provide burn to mint extra UST (Terra U.S. greenback pegged stablecoin) wanted for upcoming protocols. That appears to have marked the highest for LUNA/USD because the bullish sentiment has light since that headline, now buying and selling round 25% decrease to the underside of the rising channel drawn on the chart above.
From a technical perspective, this might attract consumers who nonetheless see the market in an uptrend, a situation that we see gained’t be invalidated from a value motion standpoint till the $35 deal with is retested and damaged. So, it’s doubtless we’ll begin to see this current dip probably decelerate on this space between $35 – $40.
Bullish reversal patterns on this space would additionally doubtless attract longer-term basic gamers, who’re doubtless centered on the present optimistic tokenomics (e.g., provide burn, rising staking yields to incentivize locking up provide, and so on.), rising UST adoption throughout totally different networks, and upcoming partnerships, together with immediately’s news of a deal with Gameville:
— Do Kwon (@stablekwon) November 18, 2021
However whereas we’ve all of that happening, there’s a rising macro threat narrative that the file excessive inflation setting we’re seeing will damage financial exercise, which might begin to push merchants away from threat belongings like crypto and again into protected havens just like the U.S. greenback. Couple that with contemporary headlines of surging covid-19 circumstances and lockdown protocols, and the U.S. greenback might actually attract capital and put the strain on LUNA/USD within the short-term.
For now, we expect the inflation/financial fears will proceed to develop, probably taking LUNA/USD right down to that vital $35 deal with. We’ll be watching there to see if it holds and if inflation pressures loosen up over the following few weeks or months.
If that’s the case, LUNA/USD may very well be a robust longer-term purchase candidate on Terra’s optimistic fundamentals and a strong technical setup (earlier assist and stochastic oversold sign), and the potential reward-to-risk setup can be favorable as nicely if maintaining a good cease slightly below $35 and a longer-term goal nicely past the earlier highs simply above $50.
What do you all assume? Will we see $35 once more on LUNA/USD? Will that attract consumers or will $35 break on rising greenback energy? Let me know within the feedback part beneath!
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