Key Takeaways:
- Tron CEO Justin Sun claims he can boost TRX by buying up $2B worth of the token.
- However, the move sounds familiar to Do Kwon's intentions in regards to LUNA.
- TRX's symmetrical triangle could take the token as low as $0.047.
YEREVAN (CoinChapter.com) – Tron (TRX) dropped a whopping 20% in the previous 24 hours and traded at $0.06 in Monday’s European session.
Meanwhile, Justin Sun, the chief executive of BitTorrent and the founder of Tron, voiced his intention to boost TRX by dumping $2 billion and buying up TRX to give shorters a hard time.
The CEO tweeted about his plans, noting that the annual percentage rate (APR) is negative 500% on Binance and that the “short squeeze is coming.” He added that TRX shorters wouldn’t “last for even 24 hours” after the $2-billion-deployment.
However, the plan sounds painfully familiar, especially to LUNA investors. Do Kwon, the chief of the infamous Terra platform, adopted a similar strategy to save its stablecoin UST, which eventually spiraled out of control, lost its dollar peg, and dragged LUNA along for the ride. As a result, the platform lost over $4.5 billion and came back as Terra 2.0, raising a wave of controversy.
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Kwon posted the following tweet on May 9, days before UST’s depeg occurred.
It is not clear if TRX will follow LUNA’s fate. However, the token’s weekly loss stood at 25% in a copycat move, retracing Bitcoin’s bearish price action.
Also read: CEL prices fall 64% over six days in the wake of the Terra fiasco.
TRX risks losing additional 25%
Moreover, TRX formed a pattern dubbed ‘Symmetrical Triangle,’ which could take Tron token an additional 25% lower. In detail, the Triangle features two converging trendlines with a similar slope, which prevent sharp moves in either direction and lower the price swing as the setup progresses.
The Symmetrical Triangle indicates a sharp move ahead, equal to the maximal distance between the trendlines without specifying the bias. However, TRX broke below the Triangle’s support, setting the bearish scenario into motion. Thus, it could lose an additional 25% to fulfill the prediction and reach the target price of $0.047.
Also read: Bitcoin (BTC) price plunges below $25K following headwinds from growing inflation — what's ahead?
As of June 13, TRX held support at $0.06. However, given the oversold relative strength index (RSI), the Tron token could defy the prediction.
However, Justin Sun’s plan for keeping Tron afloat could still backfire akin to Do Kwon’s. Admittedly, the broader economic situation will likely have a more significant say in Tron’s future price action than the Symmetrical Triangle.
