LUNA Bucks Bearish Crypto Market Trend with a Return to $90

Key Insights:

• Last week, Terra (LUNA) rose by 10.2% to end the week at $89.27 before moving through to $90 this morning.
• The upside came despite the broader crypto market seeing red in the week.
• Technical indicators suggest an imminent move, with 50-day, 100-day, and 200-day EMAs converging.

Terra (LUNA) rose by 1.42% on Sunday to join Bitcoin (BTC) in positive territory amidst a broader crypto market pullback.

On Thursday, LUNA struck a week high of $99.47 to test resistance at $100 before succumbing to market forces.

Terra Ecosystem Enhancements Deliver LUNA Price Support

It has been a busy 2022 for the Terra ecosystem, supporting a jump in total value locked (TVL). According to Defi Llama, Terra’s total value locked increased from $18.45bn on January 01 to $29.13bn, at the time of writing.

Supporting the 58% increase in TVL have been several projects, including Anchor Protocol (ANC), LIDO (LDO), and Astroport (ASTRO).

At the time of writing, Anchor’s dominance stood at 54.58%, which has driven demand for TerraUSD (UST) and investor appetite for LUNA. Anchor, built on the Terra blockchain, is a DeFi platform currently offering annualized percentage yields on staked UST of up to 19.49%.

LIDO currently offers LUNA holders a more favorable APY of 6.7% versus 3.9% for ETH and 5.2% for Solana.

Adding further LUNA price support is the demand for LUNA as a staking cryptocurrency. According to Staking Rewards, LUNA ranks third, behind Solana (SOL) and Ethereum (ETH) by total staked value.

The total USD value of all LUNA participating in staking stood at $27.89m, accounting for 41.88% of eligible tokens.

With a wave of Terra blockchain-based projects anticipated through 2022, demand for LUNA is unlikely to tumble any time soon.

In February, the Luna Foundation Guard’s purchase of Bitcoin (BTC) as a reserve currency to iron out price volatility, which also provided LUNA support.

LUNA Foundation Guard ranks Top-20 with Bitcoin holdings of 42,531, equivalent to $1.65bn.

LUNA Price Action

At the time of writing, LUNA was down by 0.73% to $89.88.

Technical Indicators

LUNA will need to move through the $90.33 pivot to target the First Major Resistance Level at $91.81.

Broader market sentiment would need to improve to support a return to $91.

In the event of an extended rally, LUNA should test the Second Major Resistance Level at $93.09 and resistance at $95.

Failure to move through the pivot would bring the First Major Support Level at $89.06 back into play. Barring an extended sell-off throughout the day, LUNA should avoid sub-$88 levels. The Second Major Support Level at $87.56.

The EMAs and the 4-hourly candlestick chart (below) send a bearish signal. LUNA currently sits below the 50-day EMA at $91.08. This morning, the 50-day EMA held steady on the 100-day EMA. The 100-day EMA also held steady on the 200-day EMA, LUNA positive.

Further convergence of the 50-day and the 100-day EMA on 200-day EMA would support a run at $95.