- Algorand price is up 4% on the day and could potentially rally 25% towards $0.32.
- A daily close above $0.2727 could be an entry signal for the bullish scenario.
- A breach of the $0.207 swing low could invalidate the uptrend thesis.
Algorand price is showing an applaudable amount of strength to start the month of February. The scalable blockchain token could rally an additional 25% if market conditions are met.
Algorand price showing strength
Algorand price is displaying bullish technicals that could be the start of a much larger upswing. On February 2, the digital blockchain token rallied by 6% to a two-month high of $0.2683, retracing into a previous trendline that once acted as support. The bulls are trying to solidify the bullish narrative by producing a candlestick close above the barrier, currently standing at around $0.2630.
Algorand price is currently trading at $0.265. The 8-day exponential moving average (EMA) was also breached during the run-up, a positive gesture that the 40% uptrend accomplished throughout January may continue.
A Fibonacci projection tool surrounding the origin points of the 40% rally and then projected into the steepest pullback at $0.207 on January 18 shows a golden pocket 61.8% projection ratio at the $0.27 zone. Traders may want to wait for a reactionary response to ALGO's first encounter with the level, as the golden pocket FIB is known to provoke strong liquidations.
Nonetheless, bears looking to short the current price action may be jumping in front of a moving train. A daily closing candlestick above the $0.2727 zone could be an entry signal to target the one-to-one ratio from the Fibonacci projection tool at $0.32. The bullish scenario would result in a 25% increase from the current market value.
ALGO/USDT 1-day chart
Invalidation of the uptrend could arise from a breach of the deepest swing low at $0.207. A breach of this barrier could result in a deeper counter-trend move likely to target liquidity levels near $0.17. The Algorand price could drop by 35% if the bears were to succeed.