The strong LUNC price rally experienced between August and early December has faded as most cryptocurrencies reversed. With the new year kicking off and the Terra Luna Classic burn rate continuing, will the LUNC token soar?
LUNC Price Falls As Burn Rate Rises
Terra Luna Classic price has retreated even as data points to an accelerating pace of burn rate. According to LUNCMetrics, the network burned 48.7 million tokens on Monday this week. Most of these burns, or about 44.5 million, were on-chain burns, while the rest were daily wallet burns.
The burn rate has been on an a gradual increase as the network incinerated 29.7 million tokens a day earlier and 17 million on Saturday. Terra Luna Classic has cumulatively burned over 286.9 million tokens in the last seven days. These burns have brought cumulative burns since inception in May 13 2022. The burning trajectory will likely continue to accelerate in 2025.
Burning or incinerating is a popular process in the crypto industry. In this process, tokens are moved to an inaccessible address, boosting their price by reducing the number in circulation.
LUNC price has also pulled back even as its ecosystem grows. For example, Air For LUNC, a top play-to-earn game in the network was recently named one of best blockchain action game of the year.
Terra Luna Classic Analysis
The LUNC price rose and peaked at $0.0001791 as Bitcoin and most other altcoins rallied. However, it then lost momentum and dropped 40% to its current $0.0001080. The token also moved below the important support level at $0.0001311, its highest swing on May 30th.
On the positive side, the coin formed a hammer pattern on December 20, a popular reversal sign. This pattern consists of a long lower shadow and a body. Another positive is that it has remained above the 200-day moving average and above the ascending trendline connecting the lowest levels since August.
LUNC Coin Price Targets
Therefore, with the LUNC price remaining above these support levels, and with the burn rate continuing, it is likely to rebound. If this happens, the first target to watch will be the support at $0.0001311, up by 21% above the current level. That will be followed by a move to the December high of $0.000179.
The alternative scenario is where the Terra Luna Classic price loses the psychological support at $0.00010. This level, which coincides with the ascending trendline, will point to more downside, potentially to $0.000079, its lowest swing on November 3.
Frequently Asked Questions (FAQs)
Terra Luna Classic price has fallen this month because of the deteriorating state of the crypto market, with Bitcoin falling from $108k to $93k.
Technically, LUNC price remains above the 200-day moving average, which is offering substantial support. Therefore, while downside risks remain, there is a likelihood that the coin will rebound.
The main catalyst for the LUNC price will be the Bitcoin trend and the ongoing token burn trend in the network.
crispus
Crispus is a seasoned Financial Analyst at CoinGape with over 12 years of experience. He focuses on Bitcoin and other altcoins, covering the intersection of news and analysis. His insights have been featured on renowned platforms such as BanklessTimes, CoinJournal, HypeIndex, SeekingAlpha, Forbes, InvestingCube, Investing.com, and MoneyTransfers.com.
Disclaimer: The presented content may include the personal opinion of the author and is subject to market condition. Do your market research before investing in cryptocurrencies. The author or the publication does not hold any responsibility for your personal financial loss.
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