Triangle Compression Builds As Market Weighs Legal Clarity And Burns

• LUNC compresses inside a converging triangle, with resistance near $0.0000400 and support at $0.0000380.
• Legal clarity and ongoing burns improve sentiment, but EMA resistance still caps rallies.
• Fundamentals strengthen through staking and upgrades, while price awaits technical resolution.

Terra Classic price today trades near $0.0000395 as volatility tightens inside a converging triangle. Buyers are defending rising trend support, while sellers continue to lean on descending resistance near $0.0000400. The setup places LUNC at a decision point heading into December 26.

Triangle Structure Signals Imminent Move

On the 1-hour chart, LUNC is coiling between a rising support trendline and a descending resistance line. Each push higher has stalled near $0.0000400, while pullbacks continue to print higher lows above $0.0000380.

This structure reduces room for indecision. When price compresses into the apex, the breakout tends to be sharp. Direction depends on which side absorbs liquidity first.

Parabolic SAR dots have flipped beneath price on recent swings, signaling short-term stabilization. However, SAR has not expanded aggressively, reinforcing the view that this is consolidation rather than trend acceleration.

Daily Chart Shows Buyers Still On The Defensive

Zooming out, the daily chart remains heavy. LUNC trades below the 20, 50, 100, and 200-day EMAs, all stacked overhead between $0.000041 and $0.000050. That EMA cluster defines the broader bearish structure.

The recent rebound from the $0.000028 area was violent, but it failed to reclaim those averages. Instead, price stalled beneath them and rolled into range. As long as LUNC remains below the 20 and 50-day EMAs near $0.000041, rallies remain vulnerable to supply.

The Supertrend on the daily timeframe still tracks above price, confirming that trend control has not shifted back to buyers.

Related: Canton Price Prediction: Descending Trendline Faces First Real Challenge Since November

Momentum Improves But Lacks Follow Through

Momentum indicators reflect balance. DMI shows rising directional strength, with +DI attempting to overtake -DI, but ADX remains moderate. That suggests participation without commitment.

This aligns with price behavior. Buyers are active enough to defend trend support, but not strong enough to force a breakout through resistance. Sellers, meanwhile, are no longer pressing aggressively lower.

Legal Clarity Removed One Overhang

The sentencing of Terra founder Do Kwon marked a major inflection for sentiment. The 15-year U.S. prison sentence removed long-standing uncertainty around legal outcomes tied to the 2022 collapse.

The immediate reaction was explosive. LUNC surged nearly 50 percent on relief that the legal chapter had closed. That move faded quickly as traders locked in gains, but the event eliminated a persistent headline risk.

Markets often rally on clarity rather than outcomes. The cooling that followed reflects normalization, not renewed fear.

Burns Continue But Supply Math Remains Heavy

Token burns remain a structural positive. Binance burned 2.5 billion LUNC in December, pushing cumulative burns past 428 billion tokens. Weekly burns continue to exceed two billion.

However, the impact is incremental. With circulating supply still near 5.47 trillion tokens, current burn rates remove roughly 0.045 percent of supply per month. That supports long-term narratives but does not drive short-term price by itself.

Burns act as a floor mechanism, not a catalyst, unless volumes accelerate materially.

Network Upgrades Add Fundamental Support

The Terra Classic v3.6.1 upgrade went live in December, addressing legacy smart contract issues and improving CosmWasm compatibility. Validators approved the changes with broad support, reinforcing governance cohesion.

Looking ahead, Market Module reactivation is planned for the first quarter of 2026. The initiative aims to test USTC stabilization mechanisms with improved liquidity balancing and burn efficiency.

Governance activity has also picked up. Proposals targeting a new EUTC forex-backed stablecoin model, wallet burns tied to Terraform Labs addresses, and a Sub-DAO structure all point toward ecosystem rebuilding rather than stagnation.

Staking participation reinforces that trend. More than 973 billion LUNC are now staked, lifting the staking ratio above 15.4 percent. That removes supply from circulation and signals long-term holder commitment.

Outlook. Will Terra Classic Go Up?

LUNC is approaching resolution.

• Bullish case: A clean break and close above $0.0000405 invalidates the triangle and targets $0.0000435, followed by the 20-day EMA near $0.000041 and the broader resistance zone at $0.000050.
• Bearish case: Loss of rising support near $0.0000380 exposes $0.000035 and risks a deeper pullback toward $0.000030 if momentum accelerates lower.

The structure is tight and time is short. A breakout will define direction. Until then, LUNC remains compressed between improving fundamentals and unresolved technical resistance.