ALGO’s price dump – Here’s what’s next for the altcoin
Disclaimer: The information presented does not constitute financial, investment, trading, or other types of advice and is solely the writer’s opinion
Algorand’s [ALGO] value has declined to its mid-January level. At press time, the token was trading at $0.2034. In fact, it could sustain more sell pressure because of the increasing uncertainty around Bitcoin [BTC].
Read Algorand [ALGO] Price Prediction 2023-24
Bitcoin [BTC] dropped below the $22K psychological level and could exert more selling pressure on ALGO. Especially if the bearish sentiment persists over the next hours/days.
Source: ALGO/USDT on TradingView
ALGO’s depreciation towards the end of February chalked a descending channel (orange). On the three-hour chart, ALGO traded sideways between the 61.8% Fib level ($0.2206) and 100% Fib level ($0.2344) before a bearish breakout on March 7. The drop has broken several lower Fib retracement levels, but the price bounced at $0.1983. At press time, the price was attempting to retest the 23.6% Fib level ($0.2068).
ALGO could face rejection at the 23.6% Fib level and move south before bouncing back from $0.1983. Alternatively, it could sink below $0.1983 and attract extra intense selling pressure.
Therefore, there could be two potential trades on the price action. First, shorting ALGO if it faces price rejection at 23.6% Fib level ($0.2068) or the 7-period EMA ($0.2050). The target would be the 0% Fib level ($0.1983). Secondly, a breach below $0.1983 and the channel’s lower boundary could offer an extra shorting opportunity at $0.1898.
A break above the 7-period EMA would invalidate the aforementioned thesis and make shorting riskier. However, the upswing could offer near-term bulls gains at the 26-period
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