The Terra protocol is growing rapidly, and its main token known as LUNA is increasing as fast as the adoption of its blockchain.
Terra aims to offer stablecoins anchored to fiat currencies, which seek to feed the payments system globally.
LUNA for its part is the main tool to stabilize the prices of said stablecoins, in addition to functioning as a method of governance of this blockchain.
At the time of this writing, LUNA is trading at $ 33.39, accumulating a gain of 39.74% in the last 24 hours, thus marking a new all-time high.
With the mega escalation of its price, it is now ranked 12th in the Crypto Online ranking.
What is happening with the LUNA token and its blockchain Terra?
Only during the last 30 days, the price of this cryptocurrency has multiplied almost by 5. The main factor behind all this: the great increase in the volume of operations.
The large influx of traders may be closely related to Coinbase. Being one of the largest exchanges in the world, your support for a project can greatly boost the buzz.
On August 12, the Wrapped Luna and Terra USD tokens were listed on Coinbase. And even though they are not exactly the LUNA token, they are all related to each other.
When new products like these are integrated into this blockchain, and are adopted with such speed, said token immediately benefits.
More than 60,000 ETH have been deposited to mint tons of UST as loans, and while this happens, the equivalent in LUNA is incinerated. This can only result in something, and that is a rise in price.
As highlighted in the following tweet, the number of addresses that UST owns increased from 80,000 to more than 460,000 in just one month, demonstrating a high speed of adoption.
There is another factor that may be adding more gasoline to the rally of this cryptocurrency. It was recently known that the Columbus-5 update is already scheduled for the Terra network, which will allow the creation of more applications and better financial incentives for users.
LUNA technical analysis
With almost 500% gains over the last month, it is already evident how well developed the current momentum is.
This is not to say that it should be sold out right now. Even today it is more likely to see new all-time highs in the next hours / days of the Terra (LUNA) token, before a really relevant correction.
We are seeing momentum develop after a large correction, thus resuming the medium / long-term trend. It is still possible that it seeks to expand further.
It is clear that in the short term the best part is over. But, a coming correction could give an opportunity to buy at better prices.
On the daily chart the momentum is also quite extended, but still we do not see exhaustion yet. Either way, with each extension of the rise, the pullback gets closer.
The 8-day EMA and 18-day SMA moving averages may function as dynamic supports in case a correction occurs in the short term.
Despite the great popularity and price increase, the first thing you should take into account when investing in this project is to know it well.
It is very important to exercise caution these days, as it can be quite easy to be swayed by emotions and end up making a decision under pressure from volatility.
If you are feeling the urge to buy because of losing the opportunity forever, it may be best to steer clear.
However, if you’ve done good research, you’ve realized Terra’s strengths, and your mind is clear to set reasonable goals, go ahead.
All our publications are informative, so in no case should they be accepted as investment advice.