Steemit Crypto Academy Trading Competition Season 6 Week 1: Trading LUNA

aneukpineung78 (71)in SteemitCryptoAcademy • 3 years ago

This is my post for Steemit Crypto Academy Trading Competition Season 6 Week 1. And I am joining the team TRADERS with Professor @kouba01 and Professor @fredquantum. This is my second post for week 1 of season 6 Trading Competition. And the token of my choice is LUNA.

Note : I performed this task on Windows 10 PC, Google Chrome.

1 – The Token I Trade: Terra (LUNA)

1.1. About LUNA

1.1.1. A Brief Introduction of the Token

^{Terra (LUNA) logo as seen on https://www.coingecko.com/en/coins/terra-luna.}

Terra (LUNA) is a blockchain protocol that uses stablecoins to support a global payment system, thus eliminates the need for banks. The native token of this blockchain is named Terra with the ticker LUNA. Terra blockchain was inisiated in January 2018 by Daniel Shin and Do Kwon.

Terra was created as a payment solution in the volatile financial ecosystem that surrounds the cryptocurrency world. Through the use of stablecoins, Terra provides assets that have the stability of fiat money but are decentralized and take advantage of the security of the blockchain network.

Starting September 2021, Terra has also been presenting stablecoins worth 1:1 with US Dollar, South Korean Won, Mongolian Tugrik.

Terra seeks to differentiate itself through the use of stablecoins that are 1:1 in value with fiat. The protocol states that they seek to combine the benefits of cryptocurrencies with the price stability of fiat currencies. Stated in its whitepaper that Terra offers fast and affordable transaction settlement.

According to this article on coingecko.com, at time of writing, Terra (LUNA) is traded at USD 49.63 per token.

^{LUNA price at timeof writing, as seen on coingecko.com.}

At the time of writing, coingecko.com shows that Terra (LUNA) is ranked on number 9 cryptocurrency based on market capitalization.

^{LUNA ranked 9th biggest cryptocurrency based on market capitalization at time at time of writing as seen on coingecko.com.}

1.1.2. LUNA Statistics

The statistics data of the LUNA token, is as seen in the table below. Data was gathered from coingecko.com, accessed on Tuesday February 22, 06:02 AM UTC.

Aspect	Value
Token Name and Ticker	Terra (LUNA)
Market Capitalization	USD 19,277,163,107
Market Cap Dominance	1.11%
Circulating Supply	387,895,120 LUNA
Max Supply	NA*
Total Supply	801,501,259 LUNA
All Time High	USD 103.34 – December 27, 2017
All TimeLow	USD 0.121798 – Mar 18, 2020
Website	https://terra.money/
Explorers	Terra; Ftmscan
	stake; Figment; Meter.

Note:
~* LUNA does not have a maximum supply because its supply always adapts to the number of stablecoins in circulation.

1.2. Where the Token Can Be Traded On

Terra (LUNA) is currently available for trade on many exchange including major exchanges like Crypto.com Exchange, Binance, HitBTC, UPbit, KuCoin, Kraken, Huobi Global, and many more.

Below is a screenshot that shows list of Terra (LUNA) pairs on some available markets. The screenshot was gained from coingecko.com Terra market page.

^{The Terra (LUNA) market, the more detailed info is available on coingecko.com Terra market page.}

Big 10 Terra markets based on the trading volume as per time of writing can be seen in the table below.

No	Exchange	Pair	Volume
1	Binance	LUNAUSDT	20.88%
2	KuCoin	LUNAUSDT	10.30%
3	OKX	LUNAUSDT	9.44%
4	HitBTC	LUNAUSDT	9.13%
5	Binance	LUNABUSD	6.93%
6	Digifinex	LUNAUSDT	3.74%
7	Bitfinex	LUNAUSD	3.31
8	AAX	LUNAUSDT	2.75%
9	Huobi Global	LUNAUSDT	2.56%
10	OKX	LUNABTC	2.55%

1.3. The Project Background – A Brief History

In 2018, Do Kwon (formerly a staff member at Microsoft) and Daniel Shin (founder and CEO of payment technology company Chai and founder of Korean e-commerce company TMON) founded Terraform Labs in South Korea. Soon after its establishment, Terraform Labs started to develop Terra. Terra was launched with a funding support of USD 32 million. Terra’s vision is to utilize blockchain technology to create an infrastructure in which will drive the massive adoption of digital payments. Currently, Do Kwon is CEO of Terraform Labs, in charge of the operation and development of the Terra project.

^{Daniel Shin and Do Kwon. Source: coinkolik.com.}

In addition, Terra is also supported by the Terra Alliance, a group of businesses and platforms advocating for Terra adoption. In February 2019, the company announced that e-commerce platforms from 10 different countries, representing a user base of 45 million and a gross merchandise value of USD 25 billion, were alliance members.

In April 2019, its mainnet was officially launched.

In July 2019, Terra announced a partnership with Chai, a South Korean-based mobile payment app. The partnership allows purchases to be made using an application on an e-commerce platform that is processed via the Terra blockchain network.

In September 2020, Terra partnered with Hex Trust, a leading DeFi digital asset custodian. This partnership is intended to enable investors to hold and stake the Terra stablecoin, via a licensed and insured storage platform.

Then in October 2020, Terra partnered with Velo Labs to build a next-generation payment system.

In January 2021, Terra partnered with Hummingbot, an open source platform. This partnership focuses on implementing a dedicated arbitrage bot to execute arbitrage trades between TerraSwap and centralized or decentralized exchanges (DEXes).

2 – Why I Am Optimistic on This Token Today

I became interested in trading Terra (LUNA) after I saw on my exchange of choice, UPbit Indonesia, that Terra (LUNA) is one of the few crypto assets that are green. Then I checked the price chart and I got a pretty convincing signal that the market was pushing up the price of Terra (LUNA), so I became quite optimistic about entering the market. So my reasoning is purely financial based on the implementation of trading theory that I have learned at Steemit Crypto Academy so far.

About how long the price of Terra (LUNA) will increase, I can't give a definite opinion in the current crypto bloodbath situation. I think, right now it's best to stay alert and trade intraday.

3 – Token Analysis

Below is the screenshot of LUNABTC price chart on 30m timeframe. The screenshot was gained from UPbit Indonesia LUNABTC page. The screenshot was taken on February 20th 2022 02:54 PM UTC.

^{The XRPBTC 30m price chart. Source: https://id.upbit.com/exchange?code=CRIX.UPBIT.BTC-LUNA.}

In analyzing the LUNA price chart, I still rely on a combination of 2 EMAs. I set each EMA with 15 periods for short periods and 50 for long periods. The screenshot above shows that Golden Cross has just taken place, and this is a good opportunity to enter the market.

On this occasion I did not combine 2 EMAs with other indicators. I tried to fully “trust” the 2 EMAs, and entered the market.

4 – The Trade Plan

In this trade, looking at the "bloody" cryptocurrency market situation, I do not dare to set a high profit target. I think I will immediately exit when the price chart shows negative symptoms. I think this trade will be an intraday trade only. I won't hold on for long.

So, the plan is still simple like my previous trade: buy some token, observe the chart, and exit the market when the negative signals shows up on the chart, but if the negative signals does not show, I will exit the market in intraday.

I bought 0.3997 LUNA at a limit price of 0.00125 BTC with a total purchase of 0.0005 BTC (=IDR 275,140.- or about USD 18.71), with a fee of 0.2% which made the total purchase cost 0.000501 (=IDR 275,690.- or about USD 18.75 ).

^{Placing limit order.}

^{The order was filled.}

5 - Recommendation

In my opinion, what Terra has done with its LUNA token, which is to provide a payment platform by utilizing technological advantages, is something very important. An increasingly interesting trick is that Terra uses the advantages of stablecoin technology. Terra's stablecoins are not supported by fiat currency, but are algorithmic. One of Terra's stablecoins is TerraUSD (UST), and it is the most popular among Terra stablecoins.

We see in Centralized Exchanges (CEX) trading, digital payment platforms have emerged and are growing rapidly. In Asia, the digital payment industry is mentioned as one of the fastest growing business sectors. Examples of the digital payment industry in CEX are Alipay, Samsung Pay, and Apple Pay. In Indonesia, the CEX top players in this industry include OVO, Go-Pay, LinkAja, Sakuku, Tokopedia, Dana, iSaku.

Terra blockchain came to be part of the digital payment industry by utilizing blockchain technology, which eliminates the involvement of third parties (financial institutions, such as banks), so in an idea, the digital payments offered by Terra promise higher security and faster transaction processing speeds. tall.

When users want to generate stablecoins on Terra, they burn LUNA. It is closely correlated with the price of LUNA, in the way that the more LUNA burned to produce stablecoins the less supply of LUNA (becomes scarce), this of course helps to "maintain" LUNA price.

Taking this into account, there are at least three aspects that influence my judgment on whether I will recommend LUNA or not:

Terra has chosen a fast-growing industrial sector, namely digital payments;
Terra leverages the stablecoin technological advantages of blockchain to achieve its goals;
LUNA as a native token needs to be continuously burned to meet the demand for stablecoins;

In addition to the three aspects above, the high adoption of LUNA that put this token at rank 9 based on market capitalization at the time of writing, prove that this token is worth considering. So, in general, and assuming that all goes well, I would recommend investing in this token.