coindesk.com
Terra’s LUNA tokens surged 27% in 24 hours to regain a $25 billion market capitalization in early European hours on Friday.
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The move erased almost all losses from Thursday, when crypto and global markets slid following Russia's invasion of Ukraine.
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LUNA traded at $66 at the time of writing, up from $50 on Thursday night, with nearly $3.8 billion worth of the tokens traded on various crypto exchanges in the past 24 hours. The 25% spike in price was among the biggest for LUNA in recent times after months of downward movements. Still, the price is down 35% from December's lifetime high of $103.
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Price chart analysis suggests LUNA could continue a run to $69 before encountering resistance. Readings on the relative strength index (RSI) gauge reached 72, suggesting a cooldown in prices as the asset enters “overbrought” levels.
LUNA rose 27% in the past 24 hours. (TradingView)
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RSI is a tool that calculates the magnitude of price movements to indicate a change in trend. Readings above 70 indicate an asset is "overbrought" and could decline, while values under 30 suggest an asset is “oversold” and could see upward movement.
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LUNA was among the largest crypto market gainers in the past two years as demand for decentralized financial services, which rely on smart contracts instead of third parties, picked up among retail traders. Investors have captured some 54,400% in gains from lows of $0.121798 on Mar 18, 2020, to the current level, data from tracking tool CoinGecko show.
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Earlier this week, Singapore-based non-profit organization Luna Foundation Guard (LFG) said it would create a bitcoin-denominated reserve as an additional layer of security for UST – Terra's decentralized stablecoin, whose value is pegged 1:1 to the U.S. dollar.
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LFG said Tuesday it had raised $1 billion through private token sales to build the reserve and the buyers will lock up the coins for four years. The funding round was led by influential crypto investors Jump Crypto, DeFiance Capital and Three Arrows Capital, causing a jump in LUNA prices at the time.
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"This is a significant step towards risk minimization and strengthening the confidence of $UST," Yeou Jie, a member of DeFiance's portfolio growth team, told CoinDesk in a Telegram chat. "The demand of $UST is also increasing steadily and the market cap is climbing."
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Other major cryptocurrencies have gained almost 10% on average in the past 24 hours. Bitcoin regained the crucial $38,000 level and ether rose to as much as $2,690 before a $40 slide in early European hours.