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Introduction of the token
LUNA Token
The Terra blockchain serves as a host for stable coins that are usually pegged against various fiat currencies. This Terra blockchain has LUNA as it's native token. The stable coins in this network can be pegged against any fiat currencies with the LUNA token used as the collateral in the network. The LUNA token also helps to regulate transactions in the network and it is also used to pay the transaction fees.
The terra blockchain has the pegged US dollar stablecoin(UST) which it uses to build a system that regulates payment within the network. The UST can be swapped for other fiat currencies at a certain ratio. For example the UST is pegged with the US dollar at a ratio of 1:1. That is; 1 UST = 1 USD. The ratio ensures that there is consistency in the values of the pegged currencies.
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The LUNA coin holders are very powerful in the Terra blockchain. For a stable coin to be accepted as the pegged coin the Terra blockchain, the holders of the LUNA coin must vote to choose their choice of stablecoin. When transactions are paid within the blockchain, the LUNA coin holders also earn some rewards from that and it serves as a profit for the holders.
Why you are optimisic about the project today/Coin Analysis
I was already holding the LUNA token in my wallet. So as time went on I suspected that there will be a downward trend so I decided to exit the market and then look for other favorable markets to enter. So I logged into Tradingview and then used the 15 mins chart to analyze the LUNA/USDT chart.
Looking at the chart above, I added the EMA indicator to the chart. We can all see that the EMA line was above the price and that is an indication of a downtrend that is about to happen.
Looking at the chart above, I also went on to add the parabolic Sar indicator. We can see that getting to the end part of the price, the dots started forming above the price. This is a signal that there will be a downtrend and it goes on to further confirm my position when using the EMA indicator.
Then lastly, as seen in the chart above, I went on to add the RSI Indicator. The RSI indicator also points to a downward trend and this go on to confirm my position on the price with the use of the EMA indicator and parabolic Sar. I then placed my Stoploss and take profit positions as seen above.
Then after that I went to the Huobi pro exchange to sell my LUNA assets using spot trade. I Sold the the LUNA token at the current market price of 0.18 LUNA. The average price at the time of selling was at $90.6192 USDT.
The details of the trade can be seen below.
Screenshot from Huobi pro
Your plan to hold it for a long time or when to sell?
Looking at the above analysis and research I made, I don’t have the intention of holding the LUNA token for a long time. This is because all the technical analysis I made are indicating a downtrend in the future and this is not good for investors.
I have also observed that there is a pegging problem within the Terra blockchain. And as we discussed, the whole idea of the Terra blockchain is pegging of different currencies and any fault found in this process means that we can no longer rely on this project. For this reason also I don’t intend to hold this token for a long time.
The future direction of the LUNA token is also not very clear to me. I am not convinced with their project so I don’t intend to put my investments in such a project.
Do you recommend everyone to buy? and the reasons for recommending/not recommending
Personally I don’t recommend this LUNA token to anyone due to the same reasons I decided on not investing in the LUNA project. The future of this project is unclear to me so I recommend that nobody invests in it.
However anybody who has interest in this project can carry on further research on the LUNA token and then see whether he can see some positives and then take a decision.
Anything other users want to share about the token/project.
The Terra blockchain has a lot of social media platforms that users can visit for information on the Terra blockchain.
The above screenshot is the Twitter handle of the the Terra blockchain which updates its users on the project from time to time. The Terra blockchain has other social media platforms as well.