2023-2-17 16:00 |
The Algorand (ALGO) price broke down from an ascending support line, indicating that the ongoing increase has come to an end.
The Algorand price has fallen below a descending resistance line since reaching an all-time high of $2.990 in November 2021. The lowest price reached was $0.16, and it was from there that ALGO began its current upward trend.
However, the Algorand price trades at an important confluence of resistance levels at $0.280. The long-term descending resistance line and the $0.280 resistance area create the resistance.
Therefore, the trend can be considered bullish once the price breaks out.
Bullish divergence in the weekly RSI preceded the entire increase (green line). The indicator may now break through 50, confirming the bullish trend.
If the ALGO price breaks out, it could move to the next resistance at $0.410. However, if a rejection follows, the price could fall back to the $0.170 support area.
ALGO/USDT Weekly Chart. Source: TradingView Algorand (ALGO) Price Fails to Sustain Upward MovementWhile the weekly chart provides an unclear reading, the technical analysis from the daily one indicates that the price is likely to decrease before resuming its upward movement.
There are two main reasons for this:
Firstly, the price broke down from an ascending support line and validated it as resistance afterward (red icon). Second, the decrease was preceded by a bearish divergence in the RSI (green line), whose trend line is still intact.
Therefore, the most likely price forecast indicates that a downward movement toward the 0.5-0.618 Fib retracement support levels is likely.
On the other hand, reclaiming the line would negate this bearish forecast. In that case, the ALGO price could increase toward the previously outlined long-term resistance at $0.410.
ALGO/USDT Daily Chart. Source: TradingViewTo conclude, the most likely Algorand price forecast for the rest of February is a downward movement toward the 0.5-0.618 Fib retracement support levels at $0.215-$0.231. On the other hand, reclaiming the short-term ascending support line would mean that the correction is complete and that the ALGO price can increase to $0.410.
For BeInCrypto’s latest crypto market analysis, click here.
The post Here’s Why You Shouldn’t Trust This Algorand (ALGO) Price Rally appeared first on BeInCrypto.
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