fxs_header_sponsor_anchor

Terra's LUNA to face extreme selling pressure at $105

  • LUNA price action outperforms the broader cryptocurrency market by making consecutive new all-time highs.
  • Massive gaps between the candlestick bodies and the Tenkan-Sen warn that a mean reversion is incoming.
  • Oscillator values confirm extreme overbought conditions.

Terraform Lab's price action has been on an impressive win streak, notching new all-time highs for the past four consecutive days. However, a pause in the upside momentum is likely to occur.

Terra to hit $105, then face a 29% drop to $75

Terra price is at an extreme. From an Ichimoku perspective, the extremes are observed by the significant gaps between the Tenkan-Sen and the bodies of the daily candlesticks. Gaps between the candlestick bodies and the Tenkan-Sen do not last long and often resolve, at the latest, within four to six periods.

The oscillators also confirm that LUNA is nearing extreme overbought conditions. The Relative Strength Index is nearing the first overbought level in a bull market, 80, and will likely exceed if Terra hits $105.

The Composite Index is also at historical highs. Therefore, if LUNA price does move to $105, the Composite Index has a high probability of creating new all-time highs. Additionally, the Optex Bands are near the overbought extremes and at a slope that suggests it will exceed those extremes.

The ceiling identified at $105 is the logarithmic 100% Fibonacci expansion for Terraform Labs. Given the near parabolic rise over the past nine days, TERRA price will likely hit this value area. A mean reversion towards the Tenkan-Sen at the psychological price level of $75 is the likely support zone.

TERRA/USDT Daily Ichimoku Chart

However, LUNA price is already quite extended, and it may not move to $105. It is entirely possible that it could retrace to the $75 level without breaching $100.

Downside risks are likely limited to the high volume node and Kijun-Sen at $68.

Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.


RELATED CONTENT

Loading ...



Copyright © 2024 FOREXSTREET S.L., All rights reserved.