Luna’s return from the dead; After the 300% price jump, what is the next move?
After the unprecedented price drop of Luna (Classic) and Tera USD (UST) as well as the collapse of the Terra network in May this year, this blockchain ecosystem has become one of the most controversial projects in the digital currency space. However, the recent one-month growth of tokens affiliated with this complex has been so great that cryptocurrency traders cannot ignore it.
To Report Cointelegraph, Luna price, Terra Network 2.0 token (Terra’s new blockchain), which is now trading under the symbol “LUNA” after the network’s old digital currency was renamed to Luna Classic (LUNC), during September ( Shahrivar) and at one point it had grown to about 300%. It should be noted that the new Luna is also traded under the symbol “LUNA2” in some exchanges.
To remind, it should be said that the Terra ecosystem now consists of two parts, namely the old blockchain or Terra Classic and the new blockchain or Terra 2.0.
Terra Classic is actually the original version of the Terra network that faced a crisis in May of this year. Terra 2.0 is also part of the plan of Do Kwon, the founder of Terraform Labs, to rebuild this ecosystem. Du Quan and Traform Labs team will periodically distribute tokens of this new network in the form of airdrops to holders affected by the price collapse of Luna Classic and Stablecoin UST, the first phase of which was carried out in June this year.
The price of new Luna started to increase on September 9 (18 Shahrivar). This stunning jump was due to positive news about the Terra ecosystem.
First, a governance proposal about Luna Classic was approved by the community members of this digital currency, according to which 1.2% of the amount of all Terra Classic network transactions will be deducted and burned in order to reduce the circulating supply of this digital currency.
Another issue, which of course has a negative side for the Terra ecosystem, is related to FatMan, the whistleblower of Terraform Labs’ activities. He had reported that during a suspicious transaction 435,000 new Lunas were sent to the Binance exchange and claimed that the sender of this transaction was Traform Labs.
Fatman wrote on his Twitter:
I was eating my lunch when I saw the price jump of Luna 2. I went to check the address of Traform Labs wallet. After months of profiteering (a sort of profit making method in DeFi) with airdrop tokens that they claim they never received, they transferred their entire inventory, which includes 435,000 new Luna units, to Binance a few days ago. This is just one of their addresses.
Let’s add that Du Kovan has denied Fatman’s accusations.
On the other hand, the jump on September 9 (18 Shahrivar) happened a week after the proposal to distribute the second phase of the airdrop of new Lunas with 19 million tokens until October 4 (12 Mehr), was approved by the vote of the Terra community.
Luna price technical analysis
From the point of view of technical analysis, Luna is facing the risk of severe correction of its price in the coming days.
As seen from Luna’s 4-hour market view, the Relative Strength Index (RSI) has reached above the 70 level, which is considered an overbought zone, and entering it can be a sign of a possible price correction in the future. In addition, the rising corner pattern is also formed on the chart, which, contrary to its name, is a bearish chart pattern.
This chart pattern is formed when the price fluctuates upwards within an ascending channel and the ceiling and floor lines of this channel are also converging (i.e. gradually getting closer to each other). The formation of this pattern is completed after the breaking of the lower trend line and at the same time as the trading volume increases.
As of yesterday, Luna was testing the lower trend line of this pattern and if it succeeds in breaking it, the price could fall to the maximum height of the bearish corner pattern at $4.49.