Luna Classic: Fake pump or start of a bullish rally?
Disclaimer: The information presented does not constitute financial, investment, trading, or other types of advice and is solely the writer’s opinion.
- Luna Classic rose by 8.2% over the past 24 hours.
- However, the price action and on-chain metrics suggested the pump could be a fake out.
The short-term pump over the past 24 hours occasioned by Bitcoin [BTC] rising sharply from $26.1k to $27.4k revived the entire crypto market. Luna Classic [LUNC] benefitted from the pump, posting 8.2% gains within the period.
Read Luna Classic’s Price Prediction 2023-24
Despite the gains, LUNC maintained its overall bearish structure, as bears look to break through a critical level that has propped up Luna Classic’s price over the past week.
Short-term pump has little effect on long-term bearish bias
The short-term rise did little to dissuade the bearish sentiment on Luna Classic. Plotting the Fibonacci levels from the recent high of $0.0000971 on 17 July to the low of $0.0000524 on 17 August highlighted key levels for the bearish swing.
After price ranged between the 78.6% Fib ($0.0000875) and 50% Fib ($0.0000747), sellers broke swiftly to the 23.6% Fib ($0.0000629) between 15 – 17 August.
The bullish recovery from the 23.6% Fib encountered resistance at the 38.2% Fib ($0.0000695), leading to price hovering just above the 23.6% Fib over the past week.
If bears successfully ride out this short pump, they can target the $0.00005 price level – another low for Luna Classic. On the flip side, if bulls sustain this pump and break above the 50% Fib ($0.0000747), it will signal a shift in momentum for LUNC.
In the meantime, the Relative Strength Index (RSI) rose sharply but failed to push past the neutral 50 level. Also, the On Balance Volume continued to slide lower. Both indicators highlighted some demand but the lack of sufficient pressure for a significant rally.
How much are 1,10,100 LUNCs worth today?
Shorts continued to bet on further price drops
The large margin held by shorts on the long/short ratio revealed the selling pressure still present on Luna Classic. Data from Coinglass showed that shorts held 67.7% of all open contracts amounting to $1.54m active shorting positions.
This highlighted the bearish dominance on LUNC’s price action with sellers actively poised to register more gains.