Terra (LUNA) Should Defend This Vital Level for Uptrend Resumption
Bitcoin touched the $52K mark briefly. However, sellers emerged to halt the uptrend. Meanwhile, LUNA has hit its ATH and retraced at this publication. That comes as momentum shifted to bears. However, the $84 – $86 value area has acted as support over the past few days. Failure to conquer bears here might translate to a swift journey to $72 by LUNA.
The upward move to $78.2 from $37.8 presented 61.8% and 27.2% extension levels near $103.19 and $89.21, respectively. These levels usually witness a somewhat temporary trend halt. The $103.6 ATH was near the extension level at $103.19, where sellers show their dedication to the market. The 21 Simple Moving Average on the four-hour chart has served as LUNA’s support during the uptrends. However, the barrier failed to resist the third retest.
While writing this article, the 55 Simple Moving Average had confluence with $89.2 as $84.5 mark acted as another potential demand for Terra. A close below $84 might see LUNA diving to $72 in the near term.
Reasoning
The Awesome Oscillator dropped under the zero line, confirming bearish strength. Also, the Chaikin Money Flow stayed beneath -0.05, showing capital moving out of the market. Both levels authorized sellers’ momentum.
The OBV approached a zone of potential support. If the on-balance volume closes under this level, LUNA will have a higher probability of dropping. The implication here is buyers did not absorb the entire selling momentum and are somewhat exhausted.
For now, LUNA buyers might step up their efforts at the next area of $72 – $76. That will happen when LUNA loses the vital level of $85.
Final Thought
Bitcoin failed to stabilize in price levels past $50,000, and LUNA secured support neat the $89 mark. Momentum appeared to lean towards bearishness, with the MA crossover (21 – 55 periods) on the time frame. For now, LUNA bulls will scrutinize the $89 level and Bitcoin actions for buyer momentum signals. Terra might experience additional pressure if BTC stays under $50K. Meanwhile, a significant move past this level will support LUNA’s momentum and possibly trigger steady upsurges.
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