As a researcher with extensive experience in the cryptocurrency market, I believe that the recent correction in Bitcoin and the subsequent sell-off in altcoins, including Terra Classic (LUNC), is a result of intensified supply pressure. The bearish momentum spread from Bitcoin to the altcoin market, causing the Terra Classic price to drop below its 7-month support level.
This week, the cryptocurrency market experienced increased pressure from suppliers due to the Bitcoin correction. The price of Bitcoin dipped to a 4-month low of $53,550 following significant sell-offs at Mt. Gox and the German government. The bearish trend then extended to the altcoin market, causing the Terra Classic price to drop below its 7-month support level, potentially leading to further declines.
Terra Classic Price: Capital Outflows Intensify Amid Market Turbulence
As a crypto investor closely observing Terra Classic’s daily chart, I’ve noticed a bearish continuation pattern taking shape – a descending triangle. This technical setup typically emerges during an established downtrend when lower highs indicate that the bearish momentum is building up for a significant correction.
Due to the downward slope of the trendline, the LUNC coin initiated a correction in early March as its price retreated from $0.00025. The subsequent bearish shift caused the asset to plummet by 73.6%, trading now at $0.0000673. Meanwhile, the market capitalization dropped significantly to $368.7 billion.
In the midst of this market decline, I’ve noticed that Terra Classic (LUNC) has fallen below its 7-month resistance line, offering sellers an additional hurdle to prevent any potential price rebound. According to Coinglass data, long position holders in LUNC experienced a significant liquidation of approximately $400 million within the past 48 hours.
In the past few months, there have been substantial withdrawals of capital from the cryptocurrency market, as pointed out by the well-known trader Ali (ali_charts) in a recent tweet. Based on Ali’s analysis, the realized net position change in the market has dropped dramatically from over $110 billion in March to just $20 billion currently.
The value of capital invested in the cryptocurrency market has significantly decreased, falling from approximately $110 billion in March to just $20 billion as of now.
— Ali (@ali_charts) July 5, 2024
The significant drop in value highlights the increased urgency for investors to sell and the mass exit of capital from the cryptocurrency market.
If the current downward trend in LUNC pricing continues, it’s possible that the coin could reach a new low and fall an additional 22%, bringing the price down to approximately $0.000052 by August 2023.
From a crypto investor’s perspective, the daily chart presents an opposing scenario where the long tail rejection suggests that buyers are actively defending the lower price range. To take back command of this digital asset, it’s essential to observe a decisive breakout above the resistance trendline.
Technical Indicator
- BB Indicator: The declining price is challenging the lower support trendline, indicating that the selling momentum is still strong.
- RSI: The daily Relative Strength Index slope entering the oversold region could attract more dip buyers looking for discounted entry points
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2024-07-06 09:08