During the last week, a significant shift has been observed in the altcoin market, primarily driven by the Terra Luna Ecosystem. This ecosystem, composed of LUNA and LUNC, has demonstrated a stunning surge, breaking through multiple resistance levels in a short time, signaling a revival of buying interest. However, as these altcoins reach new highs, some short-term traders are considering cashing in on their profits.
The Impetus Behind the LUNC’s Surge
Behind this surge is a series of events within the Terra Luna Classic community. A soft fork is currently under consideration to establish a minimum validator commission and execute technical improvements. This action was spurred by an accidental setting of the validator commission to 0% during an upgrade.
Proposed by blockchain engineer Vinh, the soft fork v2.2.2 includes the 5% commission along with other upgrades. The proposal has received unanimous approval with a 1.64% “Yes” vote share as of now. The voting is scheduled to conclude on October 3, 2023. This follows a previous decision by the LUNC community to suspend all Terra Classic USD (USTC) minting activities.
Impact on the LUNA and LUNC Prices
These developments have significantly impacted the prices of LUNA and LUNC. A noticeable surge in short-liquidation for LUNC has been observed, exceeding $20K today. Moreover, LUNC’s Open Interest has escalated by $1 million, suggesting an increase in trading activity. However, the long-short ratio dropping to 0.67 hints at a possible bearish correction.
In contrast, LUNA has experienced a bearish liquidation close to $300K. Yet, its Open Interest has skyrocketed by $16 million in just two days, indicating potential price volatility near resistance points. Similar to LUNC, LUNA is also undergoing a minor bearish correction as profits continue to be booked by buyers.
What’s on the Horizon for LUNC Price?
Over the past week, Terra Luna’s price increased by 37%, while LUNC’s price spiked by 15.6%, signifying a robust momentum in the Terra ecosystem. As of now, LUNC price trades at $0.0000658, marking an increase of over 9.5% from yesterday’s rate. However, bears are targeting a reversal, with the initial downside support at $0.000064. If the price manages to rebound from this level, it could result in a continuation of range-bound trading.
On the bearish side, if the price drops below the 20-day EMA, it would indicate a decrease in bullish momentum. This could potentially push the LUNC price to first approach the $0.000058 benchmark, followed by a potential descent to the support of $0.000055. As the RSI level is receding from the overbought region, short-term traders may exit, creating more downward pressure.
For those interested in tracking these developments, the cryptoview.io application provides real-time data and insights on the Terra Luna Ecosystem and other cryptocurrencies.
