- Algorand’s price action is showing clear signs of another selling cycle.
- ALGO risks losing another 35% of its value.
- A move above last week’s lows is very likely.
Algorand’s price action has recouped a significant amount of last week’s losses, but the technical structure is screaming for a bearish continuation move. However, sellers must first show that they clearly reject the higher prices – so far this has not happened.
Algorand’s Price Action Generates Anxiety for Bulls and Bears
Algorand’s price is at a turning point on its daily Ichimoku chart. Today is exactly one week after the May 12 flash crash. Since that crash, Algorand has made an impressive 40% gain on those lows – but those gains are now in danger of being wiped out.
A standard bearish continuation pattern known as the bearish flag is currently present. Bearish flags are ascending channels that occur after a downtrend and then usually weaken or lose momentum before the sellers return and resume the downward pressure to new lows.
The critical price level the bears will want to target is a daily Algorand price near $0.44 or lower. A close at $0.44 would be the lowest close in five days and would position ALGO just a hair above last Tuesday’s flash close and below the open. ALGO has an open path to the 2022 low at $0.34. However, the price of Algorand may drop below $0.34, possibly to the 2020 volume control point at $33.
ALGO/USDT Daily Chart Ichimoku Kinko Hyo
If the bulls want to invalidate any further downside pressure, they will at a minimum need to close Algorand’s price above the Tenkan-Sen at $0.50 or higher. But the route above $0.50 has many strong resistance levels, with some sharing the same area of value, which exacerbates this resistance. Therefore, any short-term upside potential is likely limited to the 2022 volume control point at $0.75.