• LUNA price develops bear trap on its Point and Figure chart, indicating a bullish reversal could be coming soon.
  • Breakout of a tight trading range could reverse prior losses.
  • Downside risks remain but are likely limited.

LUNA price has performed admirably over the past two weeks, especially compared to the losses the broader cryptocurrency market has suffered lately. Terra has been stuck in a range for almost the entire month of February thus far – but a bullish breakout may be imminent.

LUNA price positioned for a retest of $70, bulls look to take over

LUNA price action of late has been extremely bearish. Since the Wormhole incident, buyers have been reticent about returning to Terra – but that could change very quickly. As a result, LUNA could probably lead altcoins again and continue the bullish expansion phase before its massive selloff.

The hypothetical long entry for LUNA price is a buy stop order at $62, a stop loss at $53, and a profit target at $92. The trade represents a 3.33:1 reward for the risk setup with an implied profit target of over 50% post entry. However, several price levels will prevent a single run-up to the target at $92.

LUNA/USDT $2.00/3-box Reversal Point and Figure Chart

The first price zone of resistance is the current bear market trend line, currently at $68. If LUNA hits $68, then it will convert into a bull market, but a pullback should be expected if that occurs. The second and most likely resistance zone is the bottom of the Ichimoku Cloud (Senkou Span A, not shown) at $70. Again, selling pressure there is projected to be significant.

The long entry is based on a Bear Trap pattern in Point and Figure Analysis. The pattern requires one O to drop below a double-bottom, with the next reversal column of Xs triggering a bullish entry. If confirmed, a likely short squeeze of LUNA price will begin. But downside risks do remain.

If LUNA price dropped to $6, that would complete a Descending Triple-Bottom pattern. While not shown, the projected profit target on that theoretical short scenario is near the $32 value area.


Note: All information on this page is subject to change. The use of this website constitutes acceptance of our user agreement. Please read our privacy policy and legal disclaimer. Opinions expressed at FXstreet.com are those of the individual authors and do not necessarily represent the opinion of FXstreet.com or its management. Risk Disclosure: Trading foreign exchange on margin carries a high level of risk, and may not be suitable for all investors. The high degree of leverage can work against you as well as for you. Before deciding to invest in foreign exchange you should carefully consider your investment objectives, level of experience, and risk appetite. The possibility exists that you could sustain a loss of some or all of your initial investment and therefore you should not invest money that you cannot afford to lose. You should be aware of all the risks associated with foreign exchange trading, and seek advice from an independent financial advisor if you have any doubts.

Join Telegram

Recommended content


Recommended Content

Editors’ Picks

Cardano Price Forecast: ADA's recent breakout could trigger 15% rally

Cardano Price Forecast: ADA's recent breakout could trigger 15% rally

Cardano price rally on Monday suggests that a larger bullish move might be in the works. On-chain data shows a comeback in investor interest and entry of institutional investors.

More Cardano News

Ondo price poised to break ATH of $1.04

Ondo price poised to break ATH of $1.04

Ondo price is slowly testing its major support level at $0.63-$0.61. Aggressive buyers can consider accumulating around the immediate support zone, which extends from $0.83 to $0.80.

More Ondo News

Shiba Inu price flashes buy signal, 25% rally likely Premium

Shiba Inu price flashes buy signal, 25% rally likely

Shiba Inu price has flipped bullish to the tune of the crypto market and breached key hurdles, showing signs of a potential rally. Investors looking to accumulate SHIB have a good opportunity to do so before the meme coin shoots up.

More Shiba Inu News

New York Attorney General reaches $2 billion settlement with Genesis after claims of fraud

New York Attorney General reaches $2 billion settlement with Genesis after claims of fraud

New York Attorney General Letitia James says her office has secured a $2 billion settlement from Genesis. AG Letitia James sued the crypto company in October on account of lying and defrauding investors of over $1 billion.

More Cryptocurrencies News

Bitcoin: Is BTC out of the woods? Premium

Bitcoin: Is BTC out of the woods?

Bitcoin price shows signs of continuing its uptrend, providing a buying opportunity between $64,580 to $63,095. On-chain metrics forecast a bullish outlook for BTC ahead. If BTC clears $70,000, the chances of resuming the uptrend would skyrocket.

Read full analysis

BTC

ETH

XRP