Terra Struggles to Reverse Downtrend as Leverage Spikes

• Lower highs persist as LUNA stalls below $0.0741, keeping short-term trend bearish.
• Volatility expansion hints at a breakout, but momentum lacks strong conviction.
• Speculative open interest spikes keep driving sharp rallies and fast pullbacks often.

Terra’s LUNA token continues to trade under pressure on the 4-hour chart, even as short-term buyers attempt to regain control. Market structure still reflects a series of lower highs and lower lows from the January peak near $0.1100. 

Although price rebounded from the $0.0519 macro base, the broader trend remains tilted to the downside. Traders now watch key Fibonacci levels as volatility slowly returns to the market.

Bearish Structure Caps Recovery Attempts

LUNA currently tests the 0.236 Fibonacci retracement near $0.0657 after bouncing from its macro low. However, the token remains below the 0.382 level at $0.0741, which stands as the first meaningful resistance cluster. Consequently, buyers must reclaim this zone to shift short-term momentum.

The 4-hour Bollinger Bands have started to widen after a period of compression. This expansion suggests rising volatility and the potential for a stronger directional move. Additionally, the Chande Momentum Oscillator hovers near +40, indicating moderate buying strength. However, momentum does not yet reflect extreme conviction.

If price closes decisively above $0.0741, upside targets sit at $0.0810 and $0.0879. The 0.618 retracement at $0.0879 represents a critical trend reversal threshold. Moreover, the $0.0976 to $0.1100 region forms a heavy macro supply zone where sellers previously dominated.

On the downside, $0.0657 now serves as immediate support. A breakdown below this level increases risk toward the $0.0600 to $0.0580 demand area. If selling pressure accelerates, the macro base at $0.0519 could face another test.

Derivatives Activity Signals Speculative Cycles

Open interest data reveals repeated cycles of aggressive buildup followed by rapid deleveraging. Early positioning ranged between $3 million and $6 million before sharp spikes accompanied price rallies. Significantly, open interest surged above $15 million during late November and early December.

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That expansion quickly reversed as traders reduced exposure during the retracement phase. Recently, open interest spiked above $30 million before cooling toward $8 million. Hence, speculative bursts and liquidations continue to shape LUNA’s short-term structure.

Spot Flows Show Reactive Capital Behavior

Spot flow trends reflect prolonged distribution from April through October. During that stretch, small but consistent outflows dominated as demand remained weak. However, early November introduced intermittent inflows alongside brief price stabilization.

The most dramatic inflow event occurred in mid-December, exceeding $5 million and driving a short-term rally. Consequently, profit-taking followed, and heavy outflows erased much of the momentum. Since January, flows have hovered near neutral levels.

Technical Outlook for Terra (LUNA) Price

Key levels remain clearly defined as LUNA attempts to stabilize after its recent rebound. The broader structure still reflects a downtrend, yet short-term momentum has improved on the 4H timeframe.

Upside levels: $0.0741 (0.382 Fib) stands as the immediate hurdle. A sustained break above this level could open room toward $0.0810 (0.5 Fib). Beyond that, $0.0879 (0.618 Fib) represents the major trend-shift barrier. If bullish momentum strengthens, price could extend toward the $0.0976–$0.1100 macro supply zone.

Downside levels: $0.0657 (0.236 Fib) serves as first support. Below it, the $0.0600–$0.0580 demand zone becomes critical. A breakdown under $0.0580 exposes the $0.0519 macro base, which marks the foundation of the recent recovery attempt.

Resistance ceiling: The $0.0741–$0.0810 cluster remains the key area to reclaim for medium-term bullish momentum. Without a clean 4H close above this zone, sellers retain structural control.

The technical picture suggests LUNA is rebounding within a broader bearish channel. Bollinger Bands are expanding after compression, signaling rising volatility ahead. Meanwhile, momentum indicators show moderate buying pressure, but not strong enough to confirm reversal.

Will Terra (LUNA) Go Up?

LUNA’s short-term trajectory depends on whether buyers can defend $0.0657 and push decisively through $0.0741. A confirmed breakout could accelerate toward $0.0810 and possibly $0.0879. However, failure to hold support risks renewed downside toward $0.0580 and potentially $0.0519.

For now, LUNA trades in a pivotal zone. Volatility is increasing, but trend confirmation requires reclaiming higher Fibonacci levels. Capital flows and leverage behavior will likely determine whether this rebound evolves into a sustained recovery or fades into another lower high.

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