Listen up ALGO traders! These challenges could be en route…
- The Algorand Foundation announced a new partnership with a Web3 investment firm.
- However, ALGO failed to respond to the announcement and carved out its own path.
The Algorand Foundation took to Twitter on 26 June to announce an exciting development for the blockchain. The Foundation tweeted that Algorand secured a new partnership with DWF labs, a global multi-stage Web3 investment firm.
The aim of the partnership is to support the health and growth of the ecosystem built on the Algorand blockchain. Additionally, the first component of the partnership involved the purchase of $50 million ALGO tokens to provide liquidity into the Algorand ecosystem.
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Despite the news of the partnership, Algorand’s native token ALGO had a bleak response. As per data from CoinMarketCap, ALGO ranked #41 on CoinMarketCap’s list.
Furthermore, the token exchanged hands at $0.1303 which was 6.64% lower over the last 24 hours. However, ALGO’s seven-day performance showed a 12.19% price surge which was good news for the altcoin.
To add to the news of the partnership, ALGO’s daily price chart also painted a positive picture. Although ALGO traded 4.76% lower than its opening price for the day, its Awesome Oscillator was seen flashing green bars at the time of writing. This was a bullish indication for the token.
Furthermore, a look at the Moving Average Convergence Divergence (MACD) painted a bullish picture. The MACD line (blue) was moving above the signal line (red) at press time. However, the MACD indicator could flip in the event of increased selling pressure. This seemed like a possibility considering the position of ALGO’s Relative Strength Index (RSI).
At the time of writing, ALGO’s RSI stood at 49.85. But what was concerning was the direction in which the RSI was headed. As can be seen in the chart given below, ALGO’s RSI was seen in a descending position. This indicated a shift towards selling pressure.
Proceed with caution
The unclear scenario on the price front could be considered clarified upon look at data presented by the data intelligence platform Santiment. This was because ALGO painted a disappointing picture on the metrics front. As of 26 June, ALGO’s development activity stood at 9.48 which was nowhere close to its peak of June.
This was a clear indication that not much was happening on the development front for the Algorand blockchain. Additionally, ALGO’s weighted sentiment also stood at -1.027. This depicted that the market sentiment towards ALGO wasn’t positive at the time of writing.
Read Algorand’s [ALGO] Price Prediction 2023-2024
A fall in price combined with a dropping volume was further evidence of a declining trader interest in the buying or selling of the token.
While ALGO’s metrics painted a bearish picture, its price action still had some potential if and only if it sees some buying pressure from traders. However, in the absence of significant buying pressure, ALGO could tumble down and recovery would be a challenge.