Terra LUNA Classic price had a spectacular performance in August as speculation continued. The LUNC token jumped to a high of $0.00016, which was the highest point since June of this year. It has surged by over 240% from its lowest level this year, giving it a market cap of over $1 billion.
Why is LUNC rising?
Terra LUNA Classic is the remnant of the original LUNA that collapsed in May of this year. It is an autonomous cryptocurrency that was abandoned by the developers as they shifted to Terra 2.0.
Terra LUNA classic and Terra Classic USD prices have performed well in the past few months as investors buy the dip. The theory is that the coins will ultimately rebound in the coming months.
Analysts also believe that the rally is part of a short-squeeze as buyers attempt to squeeze short-sellers. Short squeezes have become popular in the market recently. For example, we saw shares of Revlon surge after the company announced that it was filing for bankruptcy.
The same situation happened in 2020 when Hertz filed for bankruptcy. At the same time, the situation has happened regularly in the cryptocurrency industry following the collapse of Celsius and Voyager Digital. Therefore, while Terra Luna is a useless cryptocurrency, it is relatively risky for people to short it.
In the long term it is relatively difficult to make a case for both LUNA and LUNC. For one, in the past, the value of LUNA happened because of the strong market activity in its ecosystem which was also helped by Terra USD.
Now, the ecosystem, which was made of platforms like Astroport and Anchor Protocol has disappeared. At the same time, Terra USD, which was supposed to be stable at $1 has dropped to $0.02.
Terra LUNA Classic price prediction
The four-hour chart shows that the LUNC price has been in a strong bullish trend in the past few months. As a result, the coin has managed to move above the important resistance level at $0.0001150, which was the highest point on August 1. It has rallied above the 25-day and 50-day moving averages while the Relative Strength Index (RSI) moved above the overbought level.
Therefore, Terra LUNA Classic price will likely continue rising as bulls target the next key resistance level at $0.00020.
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