Algorand’s (ALGO) Breakout Signals 55% Potential Hike as Crypto Reserve Rumors Intensify

Key Takeaways

• Algorand’s price rallied to $0.29 following speculation that it could be part of the other cryptos in the U.S. reserves.
• The altcoin’s trading volume jumped nearly three times what it was before Donald Trump’s announcement.
• ALGO has broken out of a falling wedge, with indicators showing that the price could inch toward a yearly high.
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Algorand (ALGO) is among today’s top gainers. It shows strong bullish momentum and has broken out of a key resistance level.

This breakout comes amid growing speculation that ALGO may be integrated into the proposed crypto reserve. With trading volume surging, indicators suggest that if the rumors prove true, ALGO’s rally could gain further traction.

Will this breakout mark the beginning of a sustained uptrend, or is it just another temporary hike?

Algorand Rally Gains Strength Amid High Volume

Before Donald Trump confirmed the assets included in the crypto reserve, Algorand’s price was $0.24. After the announcement, the altcoin surged to $0.29 on March 2 before slightly retracing to $0.27.

However, Trump’s confirmation that additional cryptocurrencies will be part of the reserve has kept ALGO in the spotlight. This is because it is one of the few blockchain projects founded in the U.S.

From a technical perspective, the daily chart shows that the initial rise to $0.29 led to the break out of a falling wedge. The falling wedge appears when an asset’s price hits lower highs and lower lows while contracting at the end.

According to the daily chart, ALGO’s price jumped past the lower highs over the weekend.

Adding to the bullish outlook, the CMF indicator indicates strong buying pressure. The CMF, which measures accumulation and distribution levels, has reversed upward, suggesting that the market is leaning toward accumulation.

If this trend holds, it could further propel ALGO’s price.

Moreover, Algorand’s trading volume has surged from under $150 million in the early hours of March 2 to $424 million, indicating a rising interest in the cryptocurrency.

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From a trading perspective, a price increase accompanied by growing volume is typically bullish. However, if volume declines, it could suggest that the uptrend is losing strength.

As long as ALGO’s trading volume continues to rise, the altcoin’s price could maintain its uptrend, reinforcing the case for a sustained breakout.

ALGO Price Could Jump Higher with Reserve Confirmation

Zooming into the ALGO/USD daily chart, CCN noticed that the altcoin’s value has risen above the 20-period Exponential Moving Average (EMA). The EMA measures trends and is key to determining whether prices can climb or retrace.

With ALGO trading above the 20-period EMA, bullish sentiment appears to be strengthening. If momentum continues, breaking past the 0.50 Fibonacci retracement level could push ALGO to $0.42, marking a 55% increase.

The MACD’s positive reading further supports this outlook, indicating rising momentum. Also, if Trump confirms that ALGO will be part of the reserve, the rally could be quick.

However, resistance at the 0.618 Fib level could halt the rally. If Algorand’s price fails to breach this resistance, a retracement to $0.10 could be next.