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Algorand: Are sellers subdued as ALGO retests support level $0.1805?

2min Read

Algorand [ALGO] drops to a lucrative level for swing players. But BTC faces more uncertainty and will impact ALGO investors.

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Disclaimer: The information presented does not constitute financial, investment, trading, or other types of advice and is solely the writer’s opinion

  • ALGO was bearish on the six-hour chart
  • Open interest rate flattened; funding rates were positive

Algorand [ALGO] dropped to an attractive level for trend and swing players. The asset retested its range’s lower boundary of $0.1805, and bulls were on-site at press time, as demonstrated by the long candlestick wicks.

However, the selling wave still looms, and coupled with next week’s FOMC announcement; any hawkish stance could undermine bulls. 

Read Algorand’s [ALGO] Price Prediction 2023-24

Which way for ALGO – a rebound or a bearish breakout?

Source: ALGO/USDT on TradingView

Since mid-March, ALGO oscillated between $0.1805 – $0.2347, chalking a parallel channel pattern. At press time, price action retested the lower boundary of $0.1805. The level also lined up with March swing lows. 

The downsloping 50-EMA and 200-MA indicated that sellers had the upper hand at the time of writing. In addition, the Relative Strength Index (RSI) was in the oversold zone, reiterating the seller’s leverage.

Ergo, the $0.1805 support could crack, setting the ALGO/USDT pair into an extended downtrend which could ease at December swing lows of $0.1604. If that happens, shorting ALGO if it closes below $0.1805 could offer a good risk ratio.

However, the clearance of the $0.1900 hurdle could show buyers gaining traction and will invalidate the above thesis. The move could see the pair rally towards the channel’s mid-range of $0.2076 and 50-EMA ($0.2003). A move past 200-MA could set the pair to zoom and retest the upper range boundary of $0.2347 before facing strong resistance. 

Open interest rate flattened; funding rates were positive

Source: Coinglass

How much is 1,10,100 ALGOs worth today?

ALGO’s funding rates in the past few days remained relatively positive – stable demand indicating a bullish sentiment in the derivatives market.

However, the open interest (OI) rates fluctuated in the same period. At press time, OI was flat, suggesting a likely pivot to the upside or downside. If OI rises as ALGO hits $0.20, it will signal a bullish sentiment and a possible recovery.

However, a dip in OI and the price will signal a likely bearish breakout; thus, investors can track this front alongside Bitcoin’s [BTC] price action.

Source: Coinglass


Saman Waris works as a News Editor at AMBCrypto. She has always been fascinated by how the tides of finance and technology shape communities across demographics. Cryptocurrencies are of particular interest to Saman, with much of her writing centered around understanding how ideas like Momentum and Greater Fool theories apply to altcoins, specifically, memecoins. A graduate in history, Saman worked the sports beat before diving into crypto. Prior to joining AMBCrypto 2 years ago, Saman was a News Editor at Sportskeeda. This was preceded by her stint as Editor-in-Chief at EssentiallySports.
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