Disclaimer: The information presented does not constitute financial, investment, trading or other advice and is solely the opinion of the author.
- ALGO’s recent upward trend turned into limited short-term consolidation.
- Buying volumes and open interest rates increased – boosting bulls.
algorithm [ALGO] takes advantage of the prevailing bullish sentiment to recoup recent losses. The token fell from $0.15 to around $0.90 after being categorized as “security” during the SEC lawsuit against Binance [BNB] beginning of June. But it recovered to trade at $0.13 at the time of writing, up about 25% after moving above $0.10 on June 10.
Is your wallet green? Checking out ALGO profit calculator
The Algorand ecosystem has landed a new one partnership from DFW Labs, a global Web 3 investment company, with an initial purchase of $50 million ALGO liquidity injection tokens. But the lower timeframe price charts have not responded to it as of the time of writing.
ALGO enters range formation
Source: ALGO/USDT on TradingView
After climbing above $0.10 on June 10, ALGO has made new higher highs and lower lows, defining an uptrend. But the rally faltered at $0.14, setting it up for a range formation within 61.8% ($0.13) – 78.6% ($0.14) Fib levels.
ALGO has narrowed in this range over the past four days, based on Bitcoin’s [BTC] fluctuations below $31k. If BTC consolidation continues, ALGO traders can target extremes ($0.13 & $0.14) for profits in the coming hours.
A break below the range will invalidate the neutral bias. The decline could ease to the 50% Fib level of $0.13, but will further weaken the H4 structure and turn bearish.
The RSI (Relative Strength Index) and CMF (Chaikin Money Flow) were below key neutral levels, suggesting a slight dip in buying pressure and capital inflows.
However, the picture differed on higher time frames, especially the weekly chart. In particular, Galaxy Trading, a technical crypto analyst on Twitter, believes that ALGO’s weekly chart is gold as it offers a huge accumulation opportunity.
Galaxy’s projection was based on the weekly chart retesting a critical demand zone in early 2022, with targets of $0.51 and $0.73, respectively.
Source: Galaxy Trading via Twitter
How much is 1,10,100 ALGOs worth today?
Demand on the futures market increased
On the 1-hour chart, CVD (Cumulative Volume Delta) and Open Interest (OI) have been rising over the past few days. It means buying volumes and contracts in the futures market have increased – an optimistic sentiment that could represent a potential upside, especially if BTC continues to rise.
Source: Coinalyse
But the stats have leveled off in recent hours. This bolstered the possible short-term extension of range ahead of a pump or landfill.