After the Bitcoin crash on Black Friday, the entire market appeared to be turning red, with the exception of a few altcoins like CRO and, surprisingly, LUNA. In fact, LUNA is one of the rare altcoins in the top 20, increasing more than 5% daily and 9% weekly.

LUNA 4-hour chart | Source: Tradingview

Layer 1 protocols like AVAX and LUNA have made huge gains since the start of the year. LUNA’s annual ROI against the USD at press time is a whopping 11,749.61%. However, the altcoin at number 13 has been closely following the price movement of BTC since November. After that day, it lost almost 25%.

Luna is back?

The LUNA price hit a lower low on November 16 after falling, although AVAX’s price performance gained momentum. It seems that LUNA has been hit harder by the general market decline and the following Bitcoin price. In fact, the RSI has also been down since 9/11.

Source: TradingView

Since November 26th however, LUNA started rising slightly when the RSI broke its downtrend in November. At the time of writing, price has broken critical resistance at $ 45.56.

In general, the macroeconomic uptrend is still intact. In fact, after Terra’s Columbus 5 upgrade, the price kept developing well and operated independently of the market.

The capitalization of TerraUSD (UST), the LUNA-backed native stablecoin on Terra, also rose positively last month. This month it’s down from just under $ 3 billion on 11/10. up to $ 7.17 billion at press time.

VAT working capitalization | Source: Messari

What is still missing?

After hitting the $ 10 billion mark, Terra’s Total Locked-in Value (TVL) began falling to $ 9.39 billion last week, a 6% decrease from the previous week. This could be a sign that institutional interest is waning as LUNA price closely follows BTC.

Total value locked by log | Source: Coin98Analytics

Additionally, the lack of retail FOMO in the LUNA rally appears to be a worrying trend. It is noteworthy that the trading volume is quite low and the macroeconomic downtrend in trading volume can be seen since October.

At least the price seems to break out of the downward trend due to the increased funding rate. In fact, the Open Interest (OI) in the perpetual market has increased nearly 4%.

The lack of institutional and private interest could be a reason for LUNA’s price drop, aside from the positive correlation with BTC, which appears to be broken at the time of writing. With the uptrend strengthening, a clear move from the retail side could push LUNA to a new ATH.

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