Algorand: Bearish overload keeps ALGO near this price level
Disclaimer: The information presented does not constitute financial, investment, trading, or other types of advice and is solely the writer’s opinion.
- ALGO hovered around an all-time low with sellers dominating the price action.
- Funding rates fluctuated to highlight indifference in the derivatives market.
Algorand’s [ALGO] bearish market structure saw the altcoin sink to another all-time low before making a brief recovery. The 18% price drop on 19 August saw ALGO hit $0.082 before rebounding to trade at $0.097, as of press time.
Realistic or not, here’s ALGO’s market cap in BTC terms
Despite the brief price rebound, the selling pressure was still very much present. This could see ALGO set a new all-time low in the coming days. Meanwhile, Bitcoin [BTC] continued to trade at $26k as the bearish market sentiment persisted.
Will the trend of ATLs ease?
ALGO’s bearish momentum saw it hit a series of all-time lows (ATLs) over the past three months. It hit the first ATL on 10 June and the most recent on 17 August. Despite the bullish attempt at a rebound, ALGO crumbled under the weight of intense selling pressure.
While the $0.09 support has served to ease the selling pressure, the on-chart indicators highlighted the possibility of the level being broken soon.
The Relative Strength Index (RSI) climbed out of the oversold zone but still remained firmly under the neutral 50. This revealed the lack of buying pressure for ALGO. Similarly, the Chaikin Money Flow (CMF) hovered just above the zero mark. This highlighted investors’ hesitation about a price rebound.
A break below the critical support of $0.09 would see shorts target the $0.05 – $0.07 price level, marking another new low for ALGO. However, if bulls defend the current support level, buyers can look to book profits at $0.12 – $0.14.
Mixed signals in the derivatives market
According to Coinalyze, ALGO’s Funding Rate ranged between negative and positive over the past week. This showed the lack of conviction among market speculators on a clear reversal.
How much is 1,10,100 ALGOs worth today?
Although the Open Interest (OI) saw a 7.27% rise over the past day, this could be taken as an attempt by sellers to drive the price below the support level. This was due to the lack of price increase along with the increase in open interest. This highlighted the possibility of another price dump in the long term.