A closely followed crypto strategist and trader is predicting a sharp correction for Ethereum competitor Terra (LUNA) while updating his outlook on ETH and smart contract platform Avalanche (AVAX).
In a new strategy session, pseudonymous analyst Cred says that LUNA may have printed a massive bull trap after printing a fresh all-time high of around $120.
“I don’t like this structure. I’m just drawing a structure from the highest close, the December high, and then [the] weekly [candle] closed way above it. Made a new all-time high and the next weekly just bearish engulfed it…
That’s a range-high failed breakout. Your normal target for that is the range low… Your bias shifts only if the range high is reclaimed or if price reaches the range low.”
According to Cred, LUNA may offer some support at around $60, but he highlights that the bottom of the range is close to $40, suggesting a downside potential of over 50% from its current price of $80.70.
The crypto strategist is also keeping a close watch on Ethereum, which he predicts will rally in the coming days. However, he warns that the rally will likely be short lived.
“You might end up in a situation where next week both BTC and ETH rally, but those are rallies into cluster resistance… I don’t like those types of setups.”
The last coin on the trader’s radar is Avalanche. Although Cred says AVAX looks bearish after a failed breakout above $86, he notes that its market structure can still be fixed if bulls step up to the plate.
“I think the same logic applies where if you get an $86 reclaim, the likelihood that you get another fakeout is pretty low and maybe you get that final push towards $115 or at least through the high $100 or thereabouts.”
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