Towards the end of April, Terra Classic (LUNC) price approached the 9-month resistance level at $0.000072. At the time, the Awesome Oscillator Momentum Indicator as well as the A/D Volume Indicator showed a bearish divergence with the upward price trends on the 4-hour chart.
Two weeks later, the altcoin was close to retesting the same resistance level as support. It rose 69.7% past multi-month resistance to a high of $0.000123.
The shorter time frame weakness the bulls exhibited at the time, however, was blown away by the strength of subsequent demand. Today, this same level is being tested.
Conviction of LUNC bulls will be tested
Terra Classic bulls have the opportunity to show their strength. A strong reaction from the $0.000072 level would consolidate their dominance in the market.
Technical indicators supported their attempt at supremacy. The MFI has declined in recent days, but has continued to show capital inflows. Furthermore, bullish momentum also seems to have the upper hand.
The CMF clearly showed the dominance of buyers with a reading of +0.11, signaling significant capital inflows. The rally two weeks ago also saw above-average trading volume for a prolonged period.
A price drop below former resistance would not be catastrophic, but as things stand, the bulls can likely push the price higher from $0.000072.
The 4-hour chart revealed that the $0.000066 level also constitutes an important local support zone. A drop below this swing point may see prices return to the $0.00004 to $0.00005 demand zone.
The 1-month liquidation heatmap agreed with the 4-hour chart. It marked the $0.000066 level as a key liquidity pocket. The $0.000057-$0.000060 area is another magnetic zone to watch.
Traders should not be in a rush to buy, despite recent gains. Instead, they should evaluate the altcoin’s reaction from these support levels to understand if a bullish continuation has begun.
Final summary
- The Terra Classic rally has suffered a decline in the charts.
- The price could fall another 13-25%, while keeping long-term bullish hopes intact.
