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Terra Classic (LUNC) fell more than 21% over 24 hours, while trading volume dropped 28% to $186 million. The sell-off weakened market participation, erasing a substantial portion of LUNC’s valuation and pushing its market capitalization toward $488 million.
Bullish enthusiasm faded as traders reduced exposure and sentiment weakened across derivatives markets. With volatility expanding and buying activity slowing, market focus shifted to whether conditions could stabilize before bearish pressure intensified further.
During the latest correction, long traders recorded severe losses as liquidation imbalances widened across exchanges. CoinGlass data showed long liquidations of $45.39K, compared with $5.2K in short liquidations.
The disparity reflected aggressive bullish positioning before the market reversed lower. Gate.io accounted for $32.12K of long liquidations, while Bitget recorded $12.44K. On the short side, Bitget contributed the largest share at $4.69K, whereas Gate.io recorded $391.38.
This liquidation structure indicated that leveraged longs absorbed most of the stress during the decline.
LUNC’s price action weakened after losing support from its ascending channel on the 4-hour chart. The breakdown followed a sharp rejection near the $0.00011534 resistance zone, where sellers regained control and drove the price lower.
The move took price toward the $0.00008000 demand region, which had acted as breakout support during April’s rally. Although buyers attempted to defend the area, candles continued to show instability around support, and the market structure no longer reflected sustained bullish continuation.
With the ascending channel broken, attention shifted to the $0.00007000 level below, identified as the next major support region. Unless buyers quickly reclaimed the former channel, bearish pressure was expected to remain dominant in the near term.
Directional Movement Index readings showed bearish strength increasing during the decline. The ADX rose to near 49.9905, indicating strong trend conditions despite the reversal. The negative directional index increased to 23.6506 and overtook the positive directional index, which weakened to 22.2214—signaling growing seller control after buyers lost strength near resistance.
OI-weighted funding rate data showed a shift despite the aggressive correction. Funding flipped positive to 0.0268%, suggesting that some leveraged traders still entered long positions during the sell-off. This behavior pointed to dip-buying activity rather than full capitulation.
Earlier sessions had mostly shown negative funding, consistent with short positioning dominating derivatives markets. The recent positive spike indicated some traders anticipated a rebound near current support levels. However, the broader structure still carried elevated risk because the price remained below former channel support.
Without a meaningful strengthening in spot demand, optimistic derivatives positioning alone was unlikely to reverse the prevailing bearish conditions.
