Terra Luna Classic could be on the verge of a major bullish breakout or bearish breakdown as a triangle pattern nears its confluence level. The LUNC price was trading at $0.000060 on Monday morning, a range it has maintained for the past few weeks.
LUNC Price Technical Analysis
The daily chart signals that the LUNC token price may be ripe for a big move in the coming days. That’s because it has formed a symmetrical triangle pattern whose two lines are about to converge. In most cases, a breakout or breakdown happens when this convergence is about to happen.
Furthermore, its volatility has decreased, which could be a sign of accumulation among investors. The spread between the three lines of the Bollinger Bands and the Donchian channels has narrowed drastically in the past few weeks.
Additionally, the Average True Range (ATR), a popular volatility indicator, has also declined sharply over the past few weeks.
Therefore, the combination of falling volume, symmetrical triangle, and reduced volatility is a sign that a breakout will happen. On top of this, Bitcoin is about to surge above an eight-year trendline, which could add fuel to LUNC and other altcoins.
A bullish breakout could push the Terra Luna Classic price to the 38.2% Fibonacci Retracement level at $0.00009853, which is about 62% above the current level. A drop below last year’s low of $0.000048 will invalidate the bullish forecast.
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Potential Catalysts for Terra Luna Classic
For starters, Terra Luna Classic is the remnant of Terra, a blockchain network once valued at over $40 billion. It derived its value from Terra USD (UST), an algorithmic stablecoin that promised double-digit returns.
Following Terra’s collapse, the community took charge and renamed it Terra Luna Classic. Do Kwon and his team formed a new Terra 2.0, which has yet to gain user traction.
LUNC price has three potential catalysts ahead. First, data show that social dominance has started to increase again. Per Santiment, the dominance jumped to 0.136%, its highest point since June 6. This is a sign that it is gaining traction among social media users, which could lead to the fear of missing out (FOMO).
Second, LUNC price has a positive funding rate and a low open interest figure. A positive funding rate signals that investors in the derivatives market are optimistic that the price will be higher in the future than it is today. Also, in most cases, strong bullish breakouts happen when the open interest is low.
Third, LUNC burn rate continues to surge. It has incinerated over 410 billion tokens since 2022, and the trend is continuing, with Binance leading the charge. A rising burn rate is bullish because it reduces the supply of tokens in circulation.
