Algorand Price Prediction – How Far Can the Recovery of Altcoins Go?

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The price of Algorand [ALGO] has dropped from $0.61 to $0.40, with a pullback of 34%. Previously, Bitcoin [BTC] had a slight increase in dominance, causing much of the momentum in the altcoin market to stagnate at least temporarily.

In early December's liquidation chain reaction, ALGO stabilized above $0.40, which had a huge impact on the altcoin industry. Will this level reverse the current downtrend?

Can ALGO maintain $0.40?

The $0.40 area has also doubled, as price imbalances formed at the end of November and have remained a key demand area. However, the last strong rebound from this area (cyan) was rejected at the upper channel high.

As of the time of writing, the price action has returned to this area, and due to weak demand, it could remain at this level, with the below-average RSI reading being clear evidence.

Additionally, capital inflow has improved, but still remains below key levels, helping to reverse the downtrend. In fact, the CMF (Chaikin Money Flow) shows that the inflow in December is still below zero.

Overall, if these key technical indicators remain subdued, a rebound at $0.40 may face price rejection again at the upper channel (at $0.43).

If selling pressure continues to expand and ALGO breaks the support level of $0.40, then the next relief point could be the March high of $0.33.

Will shorting yield profits?

On the 4-hour chart, SuperTrend has not reset the sell signal marked on December 9. This means that as ALGO's downtrend continues, shorting ALGO makes more sense than going long.

Spot market demand is steady, combined with low CVD spot prices, supporting the advantage of bears in the market.

In summary, due to a large influx of sellers into the market, ALGO has weakened over the past two weeks.

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