Crypto News – Yesterday, the controversial LUNA crypto experienced a big price increase, jumping more than 30% to trade above $0.5. This indicates a remarkable turn around for the token, which infamously dropped from highs of $119 in May to almost nothing after the failure of its algorithmic stablecoin, TerraUSD (UST).
Why Is Controversial LUNA Crypto Exploding 30% Despite Last Year’s Crash?
If Terra (LUNA) wants to rebuild trust and propulsion after its catastrophic collapse last year that resulted in billions in losses, it must overcome formidable obstacles. Due to problems in its algorithmic stablecoin, its original blockchain failed, and investigations into possible malfeasance are currently underway. A new Terra chain’s relaunch is still controversial. Given all the uncertainty and confusion surrounding LUNA, the observation of such a bull move leaves investors and cryptocurrency enthusiasts in a bit of a dilemma.
Market analysts claim that several reasons appear to have contributed to the price increase for LUNA. The approaching FTX trial and Do Kwon’s anticipated release from custody in late October are two potential catalysts for some traders’ renewed positive views.
What Do Analysts and Investors Think About the Current State of Luna Crypto?
Excitement in LUNA’s upside potential is growing on cryptocurrency exchanges and social media. The token has broken out of a negative resistance line that had been restricting its price motion since September 2022 and is currently at the top of Binance’s list of top gainers. Analysts claim that a short squeeze could drive prices even higher for LUNA, one of the most widely shorted tokens at the moment.
In my view, this can be the breakout that patient bulls have been waiting for. I’m waiting for a daily close above the resistance before calling the breakout a fact. But LUNA has no right to exist after last year’s collapse. This bullish push can trigger a short squeeze event that brings LUNA back up to $2 or more.
One of the traders on X
LUNA Crypto’s RSI Value Rises Above 70
Due to the recent big price increase, Terra’s (LUNA) relative strength index (RSI) is currently above 70. This suggests sustained upward momentum, which may portend more gains to come. An increased RSI value over 70, however, might also signal overbought conditions and the possibility of a pullback for well-known cryptocurrencies like LUNA.
The rising RSI curve for LUNA reveals an improving technical picture that is consistent with the developing rise in price. Technically, assuming the RSI can continue to be supported at current high levels, the prospect for near-term gains appears marginally positive. However, given the huge increase, LUNA is now susceptible to short-term profit-taking, which might trigger a brief decline when the token crosses the indicator’s overbought threshold.
Given the failings of its blockchain and concerns surrounding its relaunch earlier this year, many cryptocurrency observers continue to be wary of LUNA’s resurrection. Regulatory investigations into Terra’s collapse are also still active. Before broader confidence returns, the token would need to experience sustained support over $0.5.
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