Disclaimer: The findings of the next evaluation are the only opinions of the author and shouldn’t be thought-about funding recommendation
LUNA’s ascending wedge has been forming for over a month and it’s now, threatening a possible 46% sell-off. Merchants should be cautious of an in depth beneath the confluence of the 4-hour 200-SMA (inexperienced) and 23.6% Fibonacci stage, one which might set off a bearish final result. In the meantime, bulls can purpose for an early cut-off on the 38.2% Fibonacci stage – A zone that held up a dependable assist stage in October.
On the time of writing, LUNA was buying and selling at $51.5, up by 4.9% over the past 24 hours.
LUNA 4-hour Chart
Supply: LUNA/USD, TradingView
Three increased highs arrange at $41.5, $49.5, and $61, together with three increased lows at $27.2, $41.3, and $48.4, outlined an ascending wedge on LUNA’s 4-hour chart. Based mostly on the very best peak and the bottom valley inside the bearish sample, LUNA eyed a 47% drawdown from the breakout level. Ought to LUNA forego its streak of upper lows and weaken beneath the 200-SMA (inexperienced) and 23.6% Fibonacci stage, sellers can drive the worth all the best way to $23.52.
Bulls can counterpunch instantly on the 38.2% Fibonacci level- A zone that enabled a reversal following a double prime at $49 in October.
On the flip facet, an upwards breakout may be doable if LUNA registers a direct shut above $55, backed by sturdy volumes. Such an final result would set LUNA on target for $81.
The 4-hour RSI traded inside a gentle down channel, forming a number of bearish divergences with respect to LUNA’s value motion. Such indicators are generally noticed earlier than a retracement takes place.
Having stated that, LUNA might lengthen its wedge over the close to time period because the MACD and DMI have been nonetheless inside favorable positions.
LUNA can consolidate near $55 because the MACD and DMI shift to bearish positions. As soon as sellers reply to such cues, LUNA would break south of its wedge and arrange a possible 47% sell-off.
Merchants can go quick as soon as LUNA closes beneath the confluence of its 200-SMA (inexperienced) and 23.6% Fibonacci stage and set take-profits at $23.5.