Algorand’s [ALGO] long bets can work only if these conditions are met
Disclaimer: The information presented does not constitute financial, investment, trading, or other types of advice and is solely the writer’s opinion
- ALGO could experience a 25% potential gain in the next few weeks.
- The altcoin posted impressive development activity since the start of the year.
Algorand’s [ALGO] recent rally is yet to reclaim the pre-FTX levels of $0.4500 but could attempt such a fete soon. The asset dropped to a low of $0.1616, shedding off over 60% of its value. But it could move closer to pre-FTX levels in the next few weeks.
The recent U.S. Consumer Price Index (CPI) and Producer Price Index (PPI) data suggested easing inflation that could tip the Fed to adopt a dovish approach in its next release slated for the end of January. If that happens, it will trigger the markets positively, including the crypto sector.
Such a dovish approach could see ALGO bulls target this resistance level.
Read Algorand [ALGO] Price Prediction 2023-24
The $0.3034: Can bulls target it?
The new year’s rally saw ALGO rise from $0.1616 to $0.2407, making it close to the December high. Although the rally offered about 50% gains, it wasn’t close to pre-FTX levels.
At press time, the Relative Strength Index (RSI) was bullish at 63, while the On Balance Volume (OBV) hovered above the 1.84B level. The above conditions could tip bulls to aim at the $0.3034 resistance level, especially if BTC maintains the 22K zone and the Fed announcement is dovish.
That would be a 25% potential gain in the next few weeks. But bulls must overcome the hurdle around $0.2612 – $0.2678 and the bearish order block at $0.2407.
However, a break below the range support of $0.2081 – $0.1980 would invalidate the above bullish bias.
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ALGO’s development activity increased, but OI fluctuated
According to Santiment, development activity on the Algorand ecosystem has increased since the start of the year. This could boost investors’ confidence in its native token, ALGO, and increase its price in the long run.
Besides, ALGO witnessed spikes in total NFT trade volume, which could further boost its active users and value to investors.
Despite the price rise, ALGO’s open interest rates (OI) fluctuated in the past three weeks. At press time, the OI was on a recovery path and could boost ALGO’s uptrend momentum if the trend continued for the next few days.