Top 3 Cryptocurrencies To Watch This Week, SHIB, LUNA, ETH: For How Long Can ETH Defend $1,700?

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Last Updated May 12th 2022
6 Min Read
  • Shiba Inu price is looking to 23.6% Fibo level on its recovery from seven-month lows of $0.0000105.
  • The worst is far from over for LUNA price as Binance delists LUNA futures amid Kwon’s recovery plans.
  • Ethereum price is testing a critical multi-month support line, with no relief seen in sight.

A sea of red continues to persist in the crypto world following the fateful incident of the algorithmic stablecoin Terra (UST) de-pegging.

The stablecoin turmoil collaborated with the ongoing cryptocurrencies onslaught, smashing the flagship digital asset, Bitcoin, to test the $25,000 mark.

The bearish sentiment in the crypto market also seems accentuated by mounting concerns over global economic slowdown, in the face of the Fed’s tightening plan to combat the inflation monster.

Meanwhile, a protracted Russia-Ukraine war, China’s covid lockdowns and increased odds of a recession in the UK further fuelled growth concerns.

Amid a broader market sell-off, some of the most-watched altcoins came under the bus, with Ethereum remaining at risk of losing the crucial $1,500 level. The latest data from OKLink showed that collateral DeFi liquidations will account for $330 million should the ETH price surrender the $1,500 threshold.

Let’s see how Shiba Inu, Terra’s LUNA and Ethereum are positioned on the technical graphs.

SHIB Bulls Breathing A Sigh Of Relief But For How Long?

Shiba Inu price has paused its two-day sell-off just ahead of the $0.0000090, as sellers catch a breather after reaching the lowest level since October 2021.

In doing so, SHIB price has recaptured the $0.000010 mark, although remains exposed to further downside risks, as it extends the previous week’s downward spiral amidst a broad crypto market tumble.

The latest rebound in SHIB price could be seen as a good selling opportunity for those traders who have felt left out amid the recent collapse in the coin.

Technically, Friday’s bear flag breakdown on the daily sticks opened stairways to hell for SHIB buyers, as the price kept falling barring a brief aberration seen Tuesday.

The downside break prompted SHIB sellers to hit the pattern target measured at $0.0000150, below which a fresh downside triggered, as the coin tumbled to fresh multi-month lows below the critical $0.000010 barrier.

If the bearish pressures pick up pace, then SHIB bears will retest the seven-month lows at $0.0000091.

shib/usd daily chart 051222

SHIB/USDT: Daily chart

Although with the 14-day Relative Strength Index (RSI) in an extremely oversold region, a pullback towards $0.0000121 cannot be ruled out.

That level is the 23.6% Fibonacci Retracement (Fibo) level of the downfall from the May 5 high of $0.0000220 to sub-$0.000010 levels.

The additional recovery in SHIB price could be challenged by the 38.2% Fibo level of the same decline, pegged at $0.0000139.

Further up, the confluence of the psychological level and the 50.0% Fibo level at $0.0000150 will offer stiff resistance.

Related: Shiba Inu (SHIB) Price Prediction

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LUNA Price: Done And Dusted Despite Terra’s Recovery Efforts

Terra’s LUNA price is under the grave, having wiped off almost 100% of its value over the past week, plummeting as much as 94% on Wednesday alone.

So far this Thursday, the ill-fated LUNA is down 99% on the day, currently trading at $0.0232. That's down from $65 seen on Monday and from a record $120 in mid-April.

The downward pressure on LUNA began to intensify over the weekend, as investors liquidated their earnings on Anchor, a Terra protocol for earning yields on UST.

LUNA’s pain got exacerbated and it melted after terraUSD (UST), a Terra-issued stablecoin that's meant to be priced 1:1 to the U.S. dollar, lost its peg.

With the collapse in LUNA’s price, more LUNA coins were minted and circulated into the open markets, fuelling a fresh downswing in its price.

Despite Terra’s founder Do Kwon’s announcement of a likely recovery plan to rescue Terra Luna, the coin continued its sell-off. Kwon, in his multiple tweets, cited that the recovery plan for Terra tokens was close to completion. 

luna/usd daily chart 051222

LUNA/USDT: Daily chart

In yet another blow to LUNA, the world’s largest cryptocurrency exchange, Binance, announced that it has delisted LUNA futures. The exchange said in its press release, “Binance Futures will conduct automatic settlements on the Coin-Margined LUNA Perpetual Contracts and delist the contracts on 2022-05-12 at 08:00 (UTC).”

On the other hand, A new proposal with additional points added to Kwon's initial rescue plan for UST was presented on May 12. Do Kwon is the CEO of Terraform Labs.

The proposal, named "Agora," initiated under the number 1164 on Terra Station, is concentrated on adjustments to mint and burn parameters of UST—Terra's infamous decentralized algo stablecoin, per U-Today.

Related: Terra (LUNA) Price Predictions

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Ethereum Price Rebounds From Crucial Support, Where Next?

Ethereum price is recovering some ground over the last hours, having tumbled to the levels last seen in July 2021 just near the $1,700 threshold.

The quick retracement in the ETH price from 10-month lows propelled it to regain the $1,900 level, still losing over 8% on the day.

The no. 2 crypto coin is eyeing the sixth straight weekly loss, eroding roughly 25% of its value so far this week. The digital asset lost almost $800 at one point during this week, having opened Monday at $2,529.

From a short-term technical perspective, Ethereum has found strong support at the horizontal trendline support on the daily chart near the $1,700 region, which connects the July 19 low to the intraday lows.

If the latter is breached on a daily closing basis, it will unleash a nightmare for ETH bulls, exposing the downside towards the $1,500 level.  

The downtrend kicked in for the ETH price after a bear cross was on validated on the said time frame on May 5. The bearish 21-DMA pierced through the horizontal 100-DMA from above, signalling a potential downturn in the immediate term.

eth/usd daily chart 051222

ETH/USD: Daily chart

The oversold nature of the 14-day RSI, however, suggests that the renewed upside in ETH price could have legs.

In order to initiate any meaningful recovery, ETH buyers will need to find a strong foothold above the $2,000 round figure.

The next significant upside target appears at the daily highs of $2,184.

To conclude, the ongoing bloodbath in the crypto market is likely to keep ETH bulls at bay and recovery attempts short-lived.

Related: Ethereum (ETH) Price Predictions

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