Warning: The results of the following analysis are the author’s opinions only and should not be considered investment advice
- Algorand has been in some bullish momentum
- ALGO could retest the immediate support level at $0.2186
Algorand [ALGO] It found short support at $0.1809 after a sustained downtrend since early November. At the time of writing, ALGO was trading at $0.1924 and could move higher if the bulls maintain their momentum.
Such an upward move could cause ALGO to retest or break above the previous support at $0.2186, which acted as immediate resistance at press time.
Read Algorands [ALGO] Price forecast 2023-2024
Algorand price at $0.1809: new support or resistance?
At press time, ALGO’s Relative Strength Index (RSI) has pulled back from the oversold territory. This indicated that sellers were exhausted and buyers were gaining leverage due to higher demand for ALGO at its lowest price.
If the bulls get a bigger advantage, ALGO could rise to break the immediate resistance at $0.2186 or the exponential moving average (EMA) band at $0.2257.
However, ALGO bulls only have a clear advantage if they break the 23.5% Fibonacci retracement level at $0.2452.
However, a daily candle below $0.1809 will invalidate the upside. Such a downtrend will force ALGO to look for new support at $0.1682, $0.1442, or $0.1200.
ALGO has seen an increase in development activity, but…
According to Santiment, ALGO has seen a sharp increase in development activity since December 14th.
Until the time of publishing this news, the development activity continued to increase, coinciding with the recent partnership with Italy to support banks and insurance guarantees. Therefore, increased development activity could boost ALGO’s pricing in the coming days or weeks.
In addition, ALGO volumes have increased after the recent price drop, indicating increased selling pressure. However, after press time, the volume has increased along with the price, indicating that the buying pressure continues to rise.
This buying pressure could reinforce the upside move and push ALGO to retest or break the immediate resistance level at $0.2186.
However, Binance Funding Ratio for the ALGO/USDT pair fell into negative territory after being very positive for about a week. This could signal a bearish outlook for the pair in the derivatives market and could derail the bulls if it slips deeper into negative territory.
Bearish Bitcoin [BTC] The price may complicate the situation for the ALGO bulls. Any downtrend in BTC will drag ALGO down and negate the bullish bias described above.