The Terra LUNA token has been seeing immense demand in recent months, while the crypto market has been on a massive bearish trend, which has sent cryptocurrencies down by more than half their value. Today, we are seeing another dive in the crypto market, as the risk sentiment has turned bearish, with the ECB keeping its hawkish bias despite the conflict in Ukraine.Today, Bitcoin (BTC) has reversed, falling from above $42,000 to $39,000, Ethereum (ETH) has declined below $2,600, while Ripple (XRP) was rejected at the 100 daily SMA again.

Terra Daily Chart Analysis – LUNA Trading Above $100

LUNA coin printed a new record high at $104 yesterday

The LUNA coin has been incredibly strong since August last year, increasing by around 2,000% until the end of December, although the market had been immensely bearish for two months already. In January, we saw a pullback, as the DeFi market was in shock, due to the Wonderland controversy, which sent the DeFi TVL across the entire sector into a decline.

LUNA/USD retreated lower, from a record high of $103, falling to $44, where it met the 200 SMA (purple) on the daily chart. This moving average was tested twice, as sellers returned, but it held well and LUNA bounced off this moving average. Last month the price reached $96, and it retreated lower as the crypto market turned bearish. But the signs were bullish, since the retreat in LUNA coin was much smaller, and it didn’t wait too long before turning higher again. Yesterday, we saw a new high in this cryptocurrency, at $104, and it is now trading close to the highs again.

Terra’s $1 Billion Bitcoin Reserve to Back UST Started the Surge

The reason for this surge in the LUNA coin has been the higher demand for Terra’s stablecoin, UST. The sentiment improved last month after LUNA surged off the 200 SMA, following the announcement that UST will be backed by a $1 billion Bitcoin reserve. This has profoundly changed Terra’s investment thesis for many crypto enthusiasts, since it is believed by many to be a key step towards reducing volatility within Terra’s ecosystem.

Terra LUNA’s staked value has surged, and at $35 billion, it has now become the second network, behind Solana that stands at $40 billion, while Ethereum has $28 billion in staked coins. Terra LUNA offers a return of a 7% yield if you stake your LUNA coins with the likes of Orion.money protocol, attracting a large number of investors. So, the LUNA coin remains a strong buy, especially if today closes above $103.

Terra Coin LUNA Live Chart