Is Terra (LUNA) Done Correcting After 93% Decrease In Three Days?

Terra (LUNA) has been falling sharply since May 9 and has so far reached a low of $4.12. This is the lowest price since early 2021.

LUNA has been falling since reaching an all-time high of $119.55 on April 5. The decrease rendered that the breakout above the $105 horizontal area was only a deviation (red circle). The decrease was also preceded by bearish divergence in the weekly RSI (green line).

The downward movement accelerated during the week of May 9 to 16. So far during the week, the price has decreased by 91%.

Currently, it is trading inside the $6 horizontal area, which has not been reached since June 2021.

Cryptocurrency trader @blurcrypto tweeted a chart, which shows that the price has decreased by more than 50% in a single day.

Since the tweet, LUNA has resumed its descent and reached a low of $4.40.

Will LUNA bounce?

The daily chart shows no clear bullish reversal signs. However, the daily RSI is the most oversold it has ever been, reaching a low of 15.

Similarly, the two-hour RSI reached its all-time low of 9 on May 10, and is now possibly generating some bullish divergence.

However, the divergence is not yet confirmed and could be invalidated if the price continues falling.

Potential bottom

The wave count suggests that LUNA is mired in a very steep five-wave downward movement, of which it is in wave three (black). The sub-wave and minor sub-wave counts are given in red and white, respectively, in the chart below.

Due to the sharp drop, the use of the 15-minute chart is required in order to visualize the price movement.

While a significant bounce could occur soon, the wave count suggests that the entire decrease is not yet complete.

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