Algorand: The guide to profitably trade along ALGO’s current price structure
Disclaimer: The findings of the following analysis are the sole opinions of the writer and should not be considered investment advice.
Algorand’s (ALGO) correlation with the king coin over the last 6-7 months drew down the alt to its yearly lows in May. In its recent descent, ALGO hovered near the Pitchfork. The tool has assumed a vital area of value over the last three months.
An unpleasant reversal from the 20 EMA (red) or the Point of Control (POC, red) would reaffirm the strength of the ongoing devaluation phase.
The broader market structure will play a crucial role in determining the possibility of a bull run. At press time, ALGO traded at $0.41372, up by 6.57% in the last 24 hours.
Source: TradingView, ALGO/USD
Except for a few instances, the price has remained below the daily 20 EMA/50 EMA (cyan) for over six months. Thus, revealing the strong bearishness of the ongoing trend from a short and long-term view.
The alt lost nearly 65% of its value (from 2 April) and pulled back towards its 15-month low on 12 May. Since then, the lower fence and the Median of the Pitchfork have offered strong resistance.
As the current structure exhibited a bearish inclination, a reversal from the 20 EMA (red) or the median of the Pitchfork could lead to a continued slump. In this case, a fall below the $0.4-zone would open up shorting opportunities with a take-profit level at the $0.35-$0.37 range. However, any close above the POC or the median of the Pitchfork could lead ALGO toward the $0.5-zone.
Source: TradingView, ALGO/USD
The RSI’s recent trajectory reflected a gradual growth. But its higher peaks saw a weak bearish divergence with the price action. Thus, reinforcing the bearish edge in the near term. To invalidate this, the bulls
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