Key Takeaways
Algorand’s (ALGO) price climbed by 10% in the last 24 hours, making it one of the top-performing cryptos out of the top 100.
However, the rally may not stop at its rise to $0.39. According to CCN’s analysis, ALGO is on the brink of breaking out of a symmetrical triangle.
Beyond that, speculation continues to grow that Algorand could benefit from Donald Trump’s anticipated crypto-friendly policies as his inauguration approaches. But the main question is: How high can ALGO’s price climb?
Based on the 4-hour chart, Algorand’s price has traded within a symmetrical triangle since it hit $0.58 on Dec. 3, 2024. A symmetrical triangle appears when two trendlines with equal slopes converge toward a single point.
It signifies a consolidation phase, where price movement narrows before a breakout or breakdown. Typically, a breakdown below the lower trendline indicates the beginning of a new bearish trend. On the other hand, a breakout above the upper trendline marks the start of a bullish trend.
As seen below, ALGO’s price is flirting with the upper trendline. This implies that the price is likely to rise above the triangle pattern.
However, to validate this thesis, ALGO must defend the support at $0.34 and breach the resistance at $0.43.
In addition, the BBP has risen into the positive region, indicating that buyers (bulls) currently hold the upper hand. This also implies that prices may continue to rise.
If the BBP reading were negative, it would have indicated bearish dominance, suggesting a potential price decline.
Beyond the technical outlook, there’s growing speculation that Donald Trump’s inauguration on January 20 could positively impact ALGO.
Reports suggest that the president-elect might eliminate taxes on US-issued cryptocurrencies like ALGO, Ripple (XRP), and Hedera (HBAR), a possibility his son, Eric Trump, mentioned in December.
If that happens, this would ease the regulatory pressure the project has faced for a while. Also, demand for ALGO might increase, possibly validating the bullish bias.
Further assessment of the 4-hour chart shows that the Relative Strength Index (RSI) has increased. The RSI measures momentum by examining the size and speed of price changes.
Therefore, the increase in its reading indicates bullish momentum surrounding ALGO. The Money Flow Index (MFI), which measures the buying and selling pressure level, also supports this bias.
Typically, when the MFI decreases, sellers are in control. But since it has significantly jumped, buyers are instrumental in driving Algorand’s price further up.
If these indicators sustained the trend, ALGO could climb to $0.62, representing a 60% price increase. However, should bulls lower their guard, this might not happen.
Instead, the altcoin might drop below the 0.236 Fibonacci retracement level and slide to $0.25. Trump’s speech at his inauguration is another factor that could affect ALGO’s price action.
If the US president-elect fails to mention crypto-related policies, ALGO might not experience a surge in demand, which could validate the downturn.