Algorand: These support levels are a good place to look for buying opportunities
Disclaimer: The findings of the following analysis are the sole opinions of the writer and should not be considered investment advice
Algorand has posted gains of nearly 20% in the past five days. The charts showed that there was some resistance to be found at $0.93, $1, and $1.1 according to an analysis of higher timeframes.
On the hourly chart, the price could be slightly overextended, and therefore waiting for a pullback before buying ALGO could be the way to go over the next few hours. Bitcoin has also broken above the $42k mark and is likely to have had an impact on market sentiment.
ALGO- 1H
The $0.895 represents the previous highs that were registered in the month of March. This monthly high was broken in the past few hours, and the price faced a temporary rejection at a longer-term zone of supply in the $0.92-$0.93 area.
On longer timeframes, the move past the $0.895 is, by itself, a strong sign of bullish intent. Now, all that would need to follow on higher timeframes if ALGO registers a higher low before pushing for a higher high once more.
Where could this higher low and higher high be? To the north, $0.93 and $1 represent critical resistance levels. To the south, $0.895 and $0.873 are important support levels in the next couple of days.
Rationale
In the past week, the Awesome Oscillator made lower highs even as the price pushed higher from $0.81 to $0.85. This bearish divergence was followed by a retest of support and an impulse move to the upside.
In the next few days, market participants need to be wary of a similar scenario of a bearish divergence and retest of support. Such a series of events could be used to scout out opportunities to enter long positions.
The CMF continued to remain above +0.05 and the CVD has been green in the past few days. This showed demand has been good of late.
Conclusion
A pullback was not impossible, and the aforementioned support levels are a good place to look for buying opportunities. Until $0.81 is broken, a bullish outlook for Algorand in the near term held some validity.
