There has been a re-arrangement in the top-10 with LUNA busting to the scene.
A look at the most valuable DeFi leader-board reveals that LUNA (Terra) is now second, only trailing Uniswap with a market cap of around $13 billion.
This is to be expected considering the turn of events this week. The coin is defying gravity and is one of the few diverging projects, decoupling away from the headwinds facing Bitcoin.
As BTC/USD retraces from H2 2021 highs—at least reading from events in the past few weeks—LUNA crypto prices have been galloping higher with solid tailwinds.
Terra (LUNA) Market Performance
A look at LUNA price performance in the last 24 hours suggests strength. The coin is up 32 percent on the previous trading day and buoyed by an upsurge in trading volumes. Trading at $32, it is trending at near all-time highs—a feat registered this week.
Because of these solid, enviable gains, Terra (LUNA) is also up 64 percent week-to-date, outperforming BTC and ETH during the same period.
Considering the hype element that can’t escape crypto, LUNA’s performance will attract attention, especially now that BTC is underwhelming. At this level, therefore, it is highly likely that capital will flow into Terra’s ecosystem, further boosting the coin’s valuation.
From the LUNA/USDT candlestick arrangement in the daily chart, it is clear that the coin is trading in a bullish breakout pattern above $22—Q1 2021 highs.
Notably, the rally can be traced to the double-bottoms of June and July, from where LUNA bulls dug in from the 78.6 percent Fibonacci retracement level of the H1 2021 trade range.
At present, there is also a rapid expansion of trading volumes as LUNA bull bars band along the upper BB. Ideally, every low could offer a loading opportunity for aggressive LUNA bulls provided $22 holds.
Given the set-up in the daily chart, the odds of LUNA reaching $37—or better in the immediate term—the 1.618 Fibonacci extension level of the H1 2021 trade range—seem high.
Terra Prices reaching $40 is Realistic, Terra is “EIP-1559” on Steroids
At this pace, one trader opines that LUNA prices could further list off to $40 in the upcoming sessions.
Sold LUNA/USDT last night at $24.8 from $23.5.. wake up today.. the price rocketed 25% from $25 to $32 this morning… At this rate $40 next week not unrealistic. Heck it could push even further. Wonder if this has anything to do with the Ripple/XRP court case & market fairness
— Brendan J (@Darkz_au) August 19, 2021
He pins the rally to its fundamentals like the ongoing Ripple-SEC court case. Besides this, Terra has a higher utility and announcement of more seignorage burns via the upcoming Wormhole upgrade that makes the protocol available in several chains, including the Binance Smart Chain and Solana.
Now let's talk Columbus 5, a major upgrade underway which will:
– Burn all seignorage (more Luna burning)
– Pay more to stakers
– Cosmos IBC integrations
Terra's Wormhole upgrade will bridge Terra to Ethereum, Solana, and Binance Smart Chain. 3 of the top 5 chains by TVL.
— Lark Davis (@TheCryptoLark) August 16, 2021
All the same, the $40 level is at around key reaction levels of the Fibonacci extension tool.
LUNA Bearish Divergence Pattern, A Cool-off Incoming
Even as LUNA heats up, not everyone is convinced. One analyst on Twitter says the LUNA leg up is coming to an end if price action in the daily chart leads.
— GlobalEconomy (@GlobalEconomyEN) August 17, 2021
He picks out the formation of a bearish divergence pattern. Here, the analysts point to the higher highs and the slowing momentum of the RSI.
Momentum appears to be dumping down, sliding from the overbought territory, a concern for optimistic bulls. In any case, per his estimation, LUNA may plunge back to $21.5 in a cool-off.
Charts courtesy of Trading View
Disclosure: Opinion is that of the author. Do your own research.
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