Avalanche crypto AVAX and Terra LUNA are new crypto coins that have come out in recent years, but they have taken the market by storm as the decentralized finance (DeFi) sector has exploded, particularly this year. These two cryptocurrencies are the top DeFi coins by market capitalization and they have gained most of the value in recent months, since they have been quite bullish. They have been retracing in the last few days after the major surge which put them in the first 2 positions for DeFi coins, but are approaching some buying levels where we are thinking about buying them.
Avalanche Daily Chart Analysis – AVAX Approaching the 20 Daily SMA
Avalanche has been one of the most bullish cryptocurrencies this month, while most of the market has been on a retreat. This cryptocurrency was trading at around $10 in July, while last Sunday it reached $150, which means a 1,500% appreciation. Earlier this month AVAX/USD briefly kissed the 20 SMA (gray) but left it behind as the buying pressure picked up.
One of the reasons for this surge was the partnership with the consulting and accounting firm Deloitte. Deloitte will use the Avalanche blockchain to “improve security, speed and accuracy” of Federal Emergency Management Agency (FEMA) funding allocation. Deloitte will build a more efficient platform for its disaster-relief programme.
That sent Avalanche to number 10 in crypto coin rankings, but it has slipped to number 11 now after the retreat of the last two days. After reaching $150 AVAX has retreated more than $30 lower, trading below $1.20, with the 20 daily SMA at $105. The area above $100 would be a good place to buy, since the 20 SMA is there which should provide support and that will be the 50% Fibo retracing level as well. So, we are following the price action and might go long there on Avalanche.
Terra Daily Chart Analysis – LUNA Approaching the 20 Weekly SMA
The doji candlestick at the top, signalled the bearish reversal
Terra LUNA has also seen some very strong bullish momentum in recent months, with the total value locked (TVL) in DeFi growing by 50% since September, while TVL for Avalanche grew by 360%. Nonetheless, this increasing interest in Terra has led to the LUNA coin being enormously bullish, increasing from $5 to $55 until earlier this month.
The proposal to burn 9% of all LUNA coins, which account for around $4 billion at the time of writing was welcomed by the market, since it means that this move will bring inflation, while fiat currencies are experiencing high inflation. Altghough, the retreat in the market during these last two weeks has pulled LUNA/USD down with it, after forming a doji candlestick at the top, which is a bearish reversing signal. But, now this cryptocurrency is approaching the 20 SMA (gray) on the monthly chart, which should offer some support around $35.We will reevaluate this crypto again when the price gets there and might even open a buy signal down there.