Impact

Resistance

Terra

Reversal

LUNC, the resilient token emerging from the tumultuous aftermath of Terra’s downfall, witnessed a notable<a href="https://www.coingecko.com/" target="_blank" rel="noopener nofollow"> 14% downturn,</a> mirroring a substantial legal setback delivered by a U.S. District Court. 
This judicial decision favored the Securities and Exchange Commission (SEC) in their legal pursuit against Terraform Labs, the entity steering the Terra blockchain, injecting uncertainty into the fate of the beleaguered cryptocurrency. 
Harking back to the SEC’s assertions in February, the once-mighty stablecoin, LUNA, now lies at the heart of the controversy that unfolded in May 2022. The SEC contends that LUNA transcended the classification of a digital dollar, deeming it a security. 
<h2 id="strong-additional-pain-for-lunc-strong">Additional Pain For LUNC</h2> 
Crucially, Terraform Labs allegedly neglected to register it as such. The gravity of the situation intensifies as <a href="https://examiner.com/terraform-labs-confronts-sec-hurdle-as-court-classifies-ust-luna-as-securities/" target="_blank" rel="noopener nofollow">Do Kwon</a>, co-founder of Terraform Labs, faces accusations of orchestrating the sale of these unregistered securities, placing additional strain on the future trajectory of LUNC. 
Judge Jed Rakoff’s definitive ruling echoes a harsh reality – both LUNA and MIR, another token within the Terra ecosystem, are recognized as securities. This legal stance paves the way for potential further action by the SEC against <a href="https://bnnbreaking.com/finance-nav/cryptocurrency/federal-judge-sides-with-sec-against-do-kwon-and-terraform-labs-in-cryptocurrency-case/" target="_blank" rel="noopener nofollow">Terraform Labs</a>, casting a shadow over LUNC’s future. 
<img loading="lazy" decoding="async" class="aligncenter size-full wp-image-567402" src="https://www.newsbtc.com/wp-content/uploads/2023/12/a-193.png?resize=1024%2C347" alt="" width="1024" height="347" srcset="https://www.newsbtc.com/wp-content/uploads/2023/12/a-193.png?resize=1024%2C347?w=1545 1545w, https://www.newsbtc.com/wp-content/uploads/2023/12/a-193.png?resize=1024%2C347?w=460 460w, https://www.newsbtc.com/wp-content/uploads/2023/12/a-193.png?resize=1024%2C347?w=768 768w, https://www.newsbtc.com/wp-content/uploads/2023/12/a-193.png?resize=1024%2C347?w=860 860w, https://www.newsbtc.com/wp-content/uploads/2023/12/a-193.png?resize=1024%2C347?w=1536 1536w, https://www.newsbtc.com/wp-content/uploads/2023/12/a-193.png?resize=1024%2C347?w=750 750w, https://www.newsbtc.com/wp-content/uploads/2023/12/a-193.png?resize=1024%2C347?w=1140 1140w" sizes="(max-width: 1000px) 100vw, 1000px" data-recalc-dims="1"> 
The abrupt shift in market sentiment is evident as LUNC’s Weighted Sentiment, a metric gauging market optimism, plummeted to -0.510 post-ruling. This stark transformation from bullish to bearish suggests a loss of investor confidence in the short-term prospects of the token. 
Social Dominance, reflecting the attention given to LUNC, experienced a surge on December 29th, correlating with the court ruling. However, this heightened interest quickly dissipated, indicating that the initial impact was ephemeral, and traders may have swiftly incorporated the negative developments into their decision-making. 
<h2 data-sourcepos="3:1-3:50" id="strong-lunc-price-analysis-overall-downtrend-with-potential-for-reversal-strong">LUNC Price Analysis: Overall Downtrend With Potential For Reversal</h2> 
<ul data-sourcepos="5:1-10:0"> 
 <li data-sourcepos="5:1-5:118">The chart (below) confirms a <a href="https://www.coingecko.com/" target="_blank" rel="noopener nofollow">downward trend&nbsp;over the past seven days</a>, mirroring the bearish sentiment post-court ruling.</li> 
 <li data-sourcepos="6:1-10:0">However, technical indicators suggest a&nbsp;potential for reversal: 
 <ul data-sourcepos="7:5-10:0"> 
 <li data-sourcepos="7:5-7:84">RSI:&nbsp;Dipping towards the oversold zone, implying a possible price rebound.</li> 
 <li data-sourcepos="8:5-8:106">Negative Divergence:&nbsp;Hints at an upcoming uptrend, though the legal uncertainty adds complexity.</li> 
 <li data-sourcepos="9:5-10:0">EMAs:&nbsp;The recent 20 EMA crossover above the 50 EMA offers a bullish signal, albeit weak.</li> 
 </ul> </li> 
</ul> 
<img loading="lazy" decoding="async" class="aligncenter wp-image-567415 size-large" src="https://www.newsbtc.com/wp-content/uploads/2023/12/a-196.png?w=680&amp;resize=680%2C534" alt="" width="680" height="534" srcset="https://www.newsbtc.com/wp-content/uploads/2023/12/a-196.png?w=680&amp;resize=680%2C534 680w, https://www.newsbtc.com/wp-content/uploads/2023/12/a-196.png?w=460 460w" sizes="(max-width: 680px) 100vw, 680px" data-recalc-dims="1"> Impact Of Court Ruling: 
<ul data-sourcepos="13:1-15:0"> 
 <li data-sourcepos="13:1-13:97">The sharp drop on December 29th coincides with the ruling, highlighting its significant impact.</li> 
 <li data-sourcepos="14:1-15:0">Continued bearish momentum suggests ongoing concerns about the legal and regulatory landscape.</li> 
</ul> Support And Resistance Levels: 
<ul data-sourcepos="18:1-20:0"> 
 <li data-sourcepos="18:1-18:148">Support:&nbsp;The $0.00013 area has acted as a barrier, holding price from further decline. Maintaining this level is crucial for bullish momentum.</li> 
 <li data-sourcepos="19:1-20:0">Resistance:&nbsp;Breaking above the $0.00015 level could signal a stronger uptrend, but overcoming psychological resistance may be challenging.</li> 
</ul> Volume And Historical Trends: 
<ul data-sourcepos="23:1-27:0"> 
 <li data-sourcepos="23:1-23:86">Low volume&nbsp;indicates investor indecision, possibly due to the legal uncertainty.</li> 
 <li data-sourcepos="24:1-27:0">Comparing to historical trends: 
 <ul data-sourcepos="25:5-27:0"> 
 <li data-sourcepos="25:5-25:92">Previous support and resistance levels offer limited guidance due to the recent crash.</li> 
 <li data-sourcepos="26:5-27:0">Past volatility patterns might not be reliable given the unique legal context.</li> 
 </ul> </li> 
</ul> Overall: 
The technical indicators present a potential for LUNC reversal, but the court ruling casts a shadow of uncertainty. Closely monitor key support and resistance levels, watch for changes in volume, and remain cautious due to the volatile market conditions. 
Featured image from Shutterstock

LUNC Plunges 14% As SEC Scores Knockdown Blow Vs. Terraform Labs

Table of Contents

NewsBTC

Other articles published on Dec 30, 2023

DeFi Total Value Locked (TVL) Hits Yearly High of $52 Billion

BitMEX Founder Arthur Hayes Lost Five Million Dollars on Altcoins: Sold Three Altcoins, Bought Th...

Why Is Creditcoin (CTC) Pumping? There Is Even Room for Further Price Increase

Top Analysts Unveil Bitcoin Predictions, What’s Next For BTC Price In 2024?

Analyst Shares His Price Scenario If Bitcoin Spot ETF Is Approved

Bitcoin Miners See Significant Gains Amid Rising Transaction Fees

Join our free newsletter for daily crypto updates!