Mirror Protocol is a decentralized financial protocol built on top of the Terra blockchain. Its original token MIR suffered one of the biggest meltdowns in financial history this week after Vladimir Putin ordered a military strike against Ukraine.

Demonstration of tokens on Terra

Mirror Protocol’s native token, MIR, slipped to $0.993 on Feb. 24, its worst level yet amid a broader crypto market sell-off. But a strong recovery ensued, taking the price to $1.41 in just the next 2 days, up more than 40% from the record lows. After that, the price continued to climb and it is now trading at $1.44, up 12% in the last 24 hours.

price chart MIR/USD 4 hours | source: trade view

Similar to the decline, the price rallied after a similar rally elsewhere in the crypto market. But interestingly, MIR’s returns appear to be greater than some of the valuable digital assets, including Bitcoin and ETH.

Notably, Bitcoin is up 17% after hitting a local bottom below $34,500 on Feb. 24. On the other hand, ETH’s gains hit just over 25% over the same period after rallying from $2,300.

On the other hand, LUNA recovers more than 50% in the same period. Terra is the blockchain that hosts the Mirror Protocol aggregated asset platform.

Interestingly, another token on Terra, the Anchor Protocol (ANC), is also up more than 45% from the Feb. 24 low at $2.64 to hit a local high of around $4.

Mirror Protocol drew a “Golden Cross”, but…

The recent bullish breakout in the MIR market also formed a golden cross.

Specifically, the MIR 20-4 hour exponential moving average (20-4H EMA, blue wave) has risen above the 50-4H EMA (red wave). This movement usually results in a short-term uptrend, according to Mirror Protocol’s recent market history.

However, the MIR 4-hour Relative Strength Index (RSI) rose above 70 by the end of the week, warning of an “overbought” condition. This coincided with a correction in the Mirror Protocol market, pushing the MIR down more than 10.5% from the retracement top near $1.41.

4 hour MIR price chart, golden cross and fib retracement levels | Source: TradingView

The price broke below $1.36, one of the previous support levels, and also flowed down the 61.8 Fib line of the Fibonacci retracement that ranged from a $1.58 swing high to a $1 swing low led.

If the decline continues, the price is likely to slide towards the next support levels near the 0.5 Fib line around $1.29, followed by the 0.236 Fib line at $1.13.

Conversely, if the MIR trades above the 20-4H and 50-4H EMAs, a retest of $1.58 is possible. The bullish outlook also depends on the ongoing geopolitical conflict situation in Eastern Europe and its impact on Bitcoin.

4-hour MIR/USD price chart and Bitcoin – MIR correlation | Source: TradingView

Remarkably, the correlation coefficient between Bitcoin and the MIR is close to the 0.75 level, which means that the MIR price is more or less following the movement of the leading digital asset at the moment.

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