The Algorand price slid 12% on Wednesday as a wave of selling swept across the crypto market after Bitcoin lost the $60k support level. Algorand (ALGO) is unchanged this morning at $1.796 (+0.20%) and around 10% higher in October and 430% year-to-date. Algorand’s current market cap sits at just over $11 billion, ranking it the 20th most valuable crypto asset behind Litecoin (LTC).
Like many altcoins (although not Shiba Inu), ALGO took heavy losses on Wednesday as BTC succumbed to gravity. The sudden surge in selling, which pushed the market leader to a ten-day low of $58,100, spilt over into lower cap assets, causing a raft of deleveraging. As a result, the Algorand price retreated over 20% from Tuesday’s $2.146 high. However, dip-buying emerged at the lower numbers lifting ALGO 5% from the floor to its current price. Nonetheless, the sharp drawdown has dented the immediate outlook and may result in bearish sentiment taking over. However, if Bitcoin reclaims the $60k level, it could spur a rush back into altcoins. In that event, Algorand should resume its push towards the early October high.
The daily chart shows that Algorand is trending broadly sideways in a wide channel between $1.470 and $2.200. ALGO was approaching the top end of the range before the selling took hold on Wednesday. However, this morning, the price is below the 50-day moving average at $1.863 and targeting the lower bound.
As long as ALGO remains below the 50 DMA, it should continue towards $1.470. However, recapturing the average should set the price on a course back towards $2.20. Although I’m leaning towards a bearish outcome, either scenario is possible. In my opinion, Bitcoin could go either way from here, which inevitably means the same for ALGO. On that basis, I’m neutral at the current price point.
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This post was last modified on Oct 28, 2021, 07:19 BST 07:19