Algorand Must Hold Above Key Support to Resume Uptrend
Algorand shows ambiguity after failing to overcome a critical resistance level.
Key Takeaways
- Algorand took a 7% nosedive after trading at a high of $1.89.
- Despite the significant losses, ALGO holds above a crucial demand wall.
- Losing $1.76 as support could be devastating for this altcoin.
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Algorand’s upside potential appears to be held by the $1.90 resistance barrier. Only a decisive close above this price point could see ALGO resume its uptrend.
Algorand’s Make-or-Break Point
Volatility is back, and Algorand is one of the altcoins that has been impacted by it.
The high-performing Layer 1 token has erased all the gains it made today after a sudden spike in selling pressure struck the cryptocurrency market. Exchange data from Bybt shows that more than $180 million worth of long and short positions were liquidated across the board in the past four hours.
ALGO took a nearly 7% nosedive during this period, which saw its price drop from an intraday high of $1.89 to a low of $1.76. Despite the erratic price action seen in the past few hours, Algorand continues to trade above stable support.
The 50-day moving average appears to be acting as a significant support barrier holding this cryptocurrency. As long as it continues to do so, ALGO might be able to slice through the $1.90 resistance barrier and advance towards $2.54.
Such an optimistic outlook derives from a symmetrical triangle pattern that appears to have developed on Algorand’s daily chart since Sep. 13.
It is worth noting that a daily candlestick close below the 50-day moving average at $1.76 could invalidate the bullish thesis and lead to further losses. Breaching this crucial support level might encourage investors to exit their long positions, increasing the selling pressure behind Algorand. Under such unique circumstances, ALGO could dive towards the 200-day moving average at $1.24.
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