After having a treasury of almost $ 4,000 million, there are now only $82 million left under the protection of Terra’s Luna Foundation Guard, of which $74 million is invested in AVAX. Will they sell those Avalanche tokens?
The LFG acquired $100 million equivalent in AVAX at the beginning of April, to reinforce the support of UST. This was also aimed at strategically aligning both ecosystems.
Thanks to this, the Avalanche token was one of the ones that suffered the most from the tragedy of the Terra ecosystem.
In the midst of the Luna Foundation’s attempt to rescue the parity of the UST, they sold all the Bitcoin they had been accumulating (equivalent to more than $3,000 million) and practically the entire LUNA reserve.
However, the only currency that remained intact in the treasury was AVAX. It is possible that a pact has occurred not to get rid of these tokens, and thus avoid a possible major bleeding of the Avalanche cryptocurrency price.
AVAX has a market capitalization of $1.434 billion. This means that the LFG owns approximately 5% of that total, which although it is not a very significant amount, can undoubtedly cause fear in the market.
Technical analysis of the Avalanche (AVAX) price, amid the turbulence generated by Terra
On the monthly AVAX vs USDT chart we can see how the price seems to have achieved support at $32.90, coinciding with a retracement towards the 88.60% Fibonacci level.
Avalanche has been one of the cryptocurrencies that has performed the best throughout 2021 and 2022, so it has managed to create a strong long-term uptrend.
Now a necessary correction of this trend is in process. The question is whether the fall has reached the bottom yet.
We don’t see clear reversal signals yet, so we may see more selling in the near future. However, the recent rejection of low prices is a good first sign for the bulls.
Key short-term levels
From the daily price chart, the trend we observe is clearly bearish, and very strongly.
The 8-period EMA and 18-period SMA moving averages are crossed to the downside following this direction, and functioning as dynamic resistances every time the price breathes. Waiting for a crossover of these indicators is a good sign of a trend reversal.
The ground is currently cleared up to $14.81. It is not unreasonable to think of sales up to that price level, before the bulls take over.
Currently, the resistance that must be crossed to think about purchases is at $44.58. The most conservative would expect continuous lows and ever-higher highs.
All our publications are of an informative nature, so in no case should they be regarded as investment advice.
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