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Terra Classic USD (USTC) crashed in May last year and has never recovered. The technical analysis paints a gloomy picture, suggesting a fall to $0.0125.
Terra Classic USD Price Could Drop a Further 15%
USTC price found a launchpad from the $0.0125 level on July 14 to stage a 66% rally, setting a swing high at $0.0207. The price then turned down forming a series of lower highs and lower lows. This price action has led to the formation of a descending parallel channel on the daily chart as shown below.
This is a significantly bearish chart pattern that projects continued declines with the channel’s lower and upper boundaries providing dynamic support and resistance respectively.
At the time of writing, Terra Classic USD price was hovering around $0.0148 as the bulls and bears fought for control. The 100-day Simple Moving Average (SMA) at $0.0145 offered immediate support to the struggling “stablecoin.” A daily candlestick closing below this level would see USTC drop to the $1.14 psychological level, embraced by the 200-day SMA.
The next support could be found from the lower boundary of the prevailing chart pattern at $0.1292. Even though breaching this level would be detrimental to Terra Classic USD bulls, the downside appears to be capped at the $0.0125 psychological level. Such a move would represent a 15.3% drop from the current price.
USTC/USD Daily Chart
Apart from the bearish falling channel, a couple of other indicators supported the downward outlook for USTC. These included the trend-following oscillating indicators, the Stochastic RSI, and the Moving Average Convergence Divergence (MACD) indicator.
The Stochastic RSI was positioned in the overbought region and the price strength at 17 reinforced the bears’ grip on the TerraClassicUSD price. The MACD had just crossed the neutral line into the negative region. The call to sell USTC that was sent on July 26 when the MACD line (blue) dropped below the signal line (orange) was still in play suggesting that the market conditions still favored the downside.
On the upside, the Stochastic RSI displayed overbought conditions suggesting that the ongoing downtrend could be running out of steam. As such, the buyers could buy more USTC on the dip with the ensuing demand pressure pushing the price higher.
Note that a daily candlestick closing above the $0.0156 level, embraced by the 59-day SMA and the channel’s upper boundary, would confirm a bullish breakout from the prevailing chart pattern.
Key levels to watch on the upside are the $0.0160 psychological level, the channels apex at $0.01889, and the July 16 upswing at $0.0207.
From the technical analysis above, it is evident that TerraClassic USD price could decline further, meaning more losses for traders. As such, investors are advised to look into promising cryptos with the potential to make handsome returns in 2023. One such crypto is discussed next.
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