Terra off to new record high as LUNA price outperforms market with 30% rebound in 3 days


Terra’s LUNA resumed its upward march this week, with the value of the token rebounding greater than 30% in three days.

LUNA’s value reached almost $100 on March 9 following a 15% intraday rally, coming close to its report excessive of $106 from December 2021. At its week-to-date (WTD) low, the Terra token was buying and selling at $75.60.

LUNA/USD every day value chart. Supply: TradingView

Over 120 million LUNA burned already

The current bout of shopping for within the LUNA market appeared partially because of related recoveries elsewhere within the crypto market. For example, Terra’s main competitor within the good contract house, Ethereum, noticed its Ether (ETH) token rise by 13.50% throughout the identical interval. Equally, Bitcoin (BTC) additionally jumped by over 14% from its WTD low beneath $37,200.

Arthur Cheong, founding father of DeFiance Capital, hinted on March 9 that LUNA value elevated due to Terra’s capability to seize not less than $1 trillion or extra value of decentralized stablecoin market house by way of its native U.S. dollar-pegged token, TerraUSD (UST).

Notably, the provision of UST tokens reached over 1.4 billion on March 9, its highest stage up to now, in response to information from Good Stake. On the similar time, the Terra protocol eliminated 120 million LUNA tokens from the provision completely.

To recap: LUNA maintains UST’s greenback peg. So, if the stablecoin’s value rises above $1, the Terra protocol burns LUNA and mints extra stablecoins. Equally, if UST’s value falls beneath $1, LUNA’s valuation declines in tandem because of a slowdown within the burning mechanism.

UST vs. LUNA provide previously 30 days. Supply: Good Stake

Thus, an growing UST provide probably boosted LUNA’s value rally along with the broader restoration within the crypto market.

Terra TVL hits all-time excessive

LUNA’s features additionally appeared towards the backdrop of extra capital flowing into the Terra ecosystem.

The entire worth locked contained in the Terra protocol surged from almost $18 billion initially of this yr to $25.58 billion as of March 9, its highest stage up to now. This features a spike in whole locked LUNA tokens from 215.80 million to 298.89 million in the identical interval.

Terra whole worth locked as of March 9. Supply: Defi Llama

Terra additionally emerged as the very best staked asset amongst all of the cryptocurrencies on a 24-hour adjusted timeframe, with over $35.75 million value of LUNA tokens now locked throughout a number of platforms, in response to information useful resource Staking Rewards.

What’s subsequent for LUNA value?

Whereas LUNA appears poised to ascertain a brand new report excessive this week, its longer-timeframe technical indicators recommend the opportunity of draw back danger.

Associated: Ethereum’s TVL dominance drops to 55% as Bloomberg analyst paints $1.7K bearish goal

For example, LUNA/USD has proven a transparent bearish divergence between its rising costs and falling momentum, as indicated by its weekly relative power index — forming decrease highs for the reason that starting of 2021 — within the chart beneath.

LUNA/USD weekly value chart. Supply: TradingView

Equally, the volumes connected with LUNA’s current weekly value rally additionally appeared weaker, additional suggesting that the underlying upside momentum might stall. If this occurs, LUNA will danger present process a pointy pullback to check its exponential shifting averages (EMA), primarily the 20-week EMA (roughly $64) and the 50-week EMA (roughly $38), as helps.

The views and opinions expressed listed here are solely these of the writer and don’t essentially mirror the views of Cointelegraph.com. Each funding and buying and selling transfer includes danger, you must conduct your personal analysis when making a choice.



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