LUNC saw a pullback but could a bounce be imminent for Terra Classic?

Disclaimer: The findings of the following analysis are the sole opinions of the writer and should not be considered investment advice

• The lower timeframe structure was bearish
• However, confluence from a 4-hour chart’s support zone could see LUNC move upward

Bitcoin fell beneath the $17k mark in the hours preceding the time of writing. This meant that a move toward $16.6k could be seen soon for BTC, which in turn can drag the entire market lower. Terra Classic saw a strong surge a few days ago but has retraced almost all of those gains.

Read Terra Classic’s Price Prediction 2023-24

The Terra Classic community saw heightened social activity recently after the price posted good gains. But after the pump, a bullish continuation did not appear yet. The prediction bot highlighted that LUNC could drop to a low of $0.00013 in 2023- could this prediction materialize in January?

LUNC drops to a 4-hour bullish order block, will it offer a buying opportunity?

Source: LUNC/USDT on TradingView

LUNC saw a small pullback from $0.000168 on 1 December. A few hours after that drop, it surged to $0.000194. In doing so, it established a bullish order block in the cyan box highlighted on the charts.

At the time of writing, the price had dipped back into this zone of demand. The Fibonacci retracement levels (yellow) showed that it was within the 61.8%-78.6% golden pocket. Therefore, a move back above $0.0001688 and a retest of the same as support can offer a lower timeframe buying opportunity.

This idea went against the momentum in the market. Both the RSI and the moving averages showed strong bearish momentum. If Bitcoin can defend $16.6k, then a bounce in LUNC prices could follow.

On the other hand, if an hourly trading session closed beneath the bullish order block, the buying notion can be scrapped. The order block would be flipped to a bearish breaker, and that can take some time to be beaten and flipped to support once more.

The decline in Open Interest showed discouraged buyers in the futures market

Source: Coinglass

LUNC saw a sharp increase in Open Interest on 2 December when the price rallied from $0.000162 to $0.000194. Since then, the Open Interest has slowly been in decline. At the same time, the price has also seen downward momentum.

Funding rates had also been positive during the surge to show buyers were interested, but since then it has fallen back toward zero. The inference was that long positions opened after the surge was likely late. They could be forced to close at a loss, which can fuel more downside.