Algorand Market Analysis

Algorand had a bearish market structure on the daily chart
Reduced speculations and spot demand suggested further losses may be likely in the short-term

Algorand (ALGO) was one of the coins that thrived in the past cycle, reviving itself last month with a remarkable bullish run, gaining 480% in one month before beginning to decline in early December.

Additionally, the altcoin’s volume indicators outlined trouble ahead, indicating potential price losses.

Algorand Losing Bullish Momentum

ALGO retreated from its local high of $0.613 since the first week of December, coinciding with Bitcoin (BTC) trading within its range. Recently, BTC climbed back above $100k, but ALGO continued to fall.

The market structure for Algorand flipped bearishly on December 9. Since then, the Chaikin Money Flow (CMF) has trended downward, indicating decreased capital inflows, with a current reading of +0.01—reflecting neutrality that hasn’t recovered the bullish structure.

The Accumulation/Distribution (A/D) indicator is also declining. Both volume indicators demonstrate a quick loss of strength among Algorand bulls over the past ten days, which is further supported by the Awesome Oscillator’s signals of momentum loss.

Next support levels are highlighted by the Fibonacci retracement levels. The 50% level at $0.36 has been previously tested as support, but ALGO may test it again, with potential drop targets of $0.3 and $0.2145 in the next month or two, unless demand strengthens again.

Sentiment and Development Activity

Recent data from Santiment indicates that the weighted sentiment, previously highly positive two weeks ago, has now started to decline. Concurrently, development activity has decreased, with no contributors reported since December 10, potentially due to the holiday season, which, if not typical, may indicate an anomaly.

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Finally, Open Interest has declined slowly, alongside flat Spot CVD over the past 24 hours. However, it may be premature to determine if selling pressure has halted.

Overall, further losses appeared likely at press time.

Disclaimer: The information presented does not constitute financial, investment, trading, or other types of advice and is solely the writer’s opinion.