Assessing the leverage of LUNA bulls to move past this order block

Disclaimer: The findings of the following analysis are the only opinions of the writer and should not be considered investment advice

Terra has had a solid run on the charts for the past few weeks. Beginning of March, news came out that $30 billion worth of LUNA was staked across platforms, compared to Ether at $27 billion. This coincided with a strong rally in the charts, supported by real demand.

In recent days, this bullish impulse has lost some momentum and the price has been trading within a range. Is an outbreak imminent or are the bears re-sharpening their weapons for battle?

LUNA- 1H

In white is a range of $85.1 to $94.8, one within which LUNA has been trading for most of the past week. This range, despite the deviation to $83, matters because of the importance of the $90 mid-range (white dotted). This level has consistently acted as support and resistance for the past week.

The price action indicated that a test of range highs was followed on March 14 by a bearish engulfed candle. This was indicative of a bearish order block on the range highs (red box) and an area where sellers are likely to be strong again.

A rejection here would likely lead LUNA back to the lows of the range in search of liquidity.

rode

Source: LUNA/USDT on TradingView

The indicators also appeared to be favorable for a downward move. The RSI, while showing strong bullish momentum, set steady highs as the price hit higher highs. This pointed to the possibility that momentum was running out even as the price moved higher.

The Stochastic RSI has formed a bearish crossover in the overbought territory, while the OBV has not registered a new high in the past week.

This could all change in the coming hours if LUNA can break past the $94.5 zone and test it again if demand is there. However, as things stood at the time of going to press, a return to $90 and $85 seemed likely.

Conclusion

The indicators underlined the possibility of a move towards the lows of the range for LUNA. The price action showed a clear order block of $94, one that could determine the direction of the next move for the altcoin.

Leave a Comment