- Luna Coin price sparked a parabolic bull rally of nearly 70% after battling the 8.5 resistance
- The LUNA / USDT release price is $ 14.30 based on a 16% increase over the past 24 hours
- The daily RSI is hovering in the 84 area, indicating overbought signals
A dive into the basics of LUNA Coin
Terra Blockchain has paved its way into mass adoption by expanding the list of projects and partners starting on the platform. The growing acceptance of the Terra EcoSystem has attracted several crypto investors. The demand for the blockchain network is so great that AMCs like Pantera Capital and Arrington XRP have committed to investing $ 150 million in the Terra ecosystem.
But that is not the only reason for the LUNA price increase. Terra, as we all know, is best known for producing and minting algorithmic stable coins. Since the process of minting a stable coin is rewarded by LUNA, this emphasizes the use of LUNA to mint UST. Since profits are made in LUNA from minting the stable coin, it is paid into the community pool. With around 76 million LUNA in the community pool at a price of 14 USD per LUNA, the total price is 1 billion USD.
In simple terms, the process of minting new UST involves burning an equivalent amount of LUNA, which in turn affects the demand and supply of LUNA. That being said, the tokens burned in the communal pool are not the existing tokens, but the tokens that should be added to the pool.
With around $ 41.93 million already burned last week, the price of LUNA Coin has increased 55%.
In addition, the fees generated by swaps, ie the transaction fees for the purchase of LUNA, UST, now go to LUNA-Staker. This is extremely optimistic for LUNA Coin as more people will now join the staking community.
LUNE Coin is designed to retrace before challenging new highs
LUNA / USDT on TradingView
LUNA Price returned 90% gains after turning the 200 EMA into a cushion of support. This step was accompanied by the Golden Cross, which set off a parabolic wave.
In addition to price fighting critical levels of resistance, price action broke out of the descending macro trend line in yesterday’s intraday session. After a successful breakout, the price is ready to retest the trendline supported by the USD 13.39 support cushion. This increase will result in a decrease of around 7% compared to the current price. Additionally, the loss of the $ 13.39 support cushion will expose the LUNA price to an 11.4% decline, which will be fixed by the re-examination of the $ 11.86 support level.
In order for the bulls to restore another price hike, the price requires a closing price above the overhead resistance of $ 14.8. A break above this certain level will expose LUNA Coin to rally another 22%. LUNA’s price is currently at a low of only 35% of its ATH and has emerged as one of the best performing assets of the past week.
However, the rejection from the $ 14.8 resistance forecast a small setback for the upcoming sessions. To add even more credibility to the small pullback, the Daily RSI has entered the overbought territory. As demonstrated by the 2.3% intraday losses, the retracement is currently in play.
SUPPORT: $ 14.8
RESISTANCE: $ 13.9
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