Algorand’s price has risen more than 50% over the past week, rising to $0.126 on Monday and emerging as the best-performing cryptocurrency on the weekly time frame.
summary
- Algorand price rose more than 50% in a week to hit an 11-week high of $0.126, driven by recognition in Google Quantum AI search and new access to stakes via Revolut
- A breakout from the multi-month falling wedge, coupled with strong Aroon readings and positive money flow readings, suggest continued bullish momentum towards $0.20.
- Futures open interest has risen to $75 million, with bullish positions and a negative funding ratio indicating a potential short squeeze and further upside pressure.
According to data from crypto.news, Algorand (Something) reached an 11-week high of $0.126 on April 6, putting its market capitalization at close to $1.1 billion.
This gathering came after A Quote from Google Quantum AI In a research paper focusing on the threats major blockchains face from quantum computing. The paper cited Algorand several times for its post-quantum security and advanced Falcon signature technology.
The token also gained significant traction after Revolut rolled out ALGO’s native staking system, giving access to its 70+ million users to stake directly through the app.
There are three reasons why this trend continues.
First, Algorand confirmed a breakout from a multi-month falling wedge pattern on the daily chart. A falling wedge consists of two converging downward trend lines, and a breakout is often a precursor to sustained rises. As such, the token could continue to rise as high as $0.20, which is in line with the 50% Fibonacci retracement level.
These expectations are supported by bullish technical indicators. It is worth noting that the Aroon Up indicator at 85.71% lies significantly above the Aroon Down indicator, while the Chaikin Money Flow indicator showed a positive reading of 0.17, a sign that investors were already injecting capital into the asset.
Second, demand from derivatives traders was strong this week.
Data CoinGlass shows that open interest in the futures market has increased from $30 million to $75 million in one week. In addition, the buy/sell ratio has moved above 1, indicating that most traders are bullish. This means that market sentiment is strongly tilted towards further price rises as participants bet on higher targets.
Third, the weighted funding rate of the cryptocurrency has become negative. With the sudden rise in the price of Algorand, this environment creates the ideal conditions for a potential selling pressure.
A short squeeze would force sellers to cover their positions, providing the momentum needed to push the token’s rally towards the $2 target.
Disclosure: This article does not constitute investment advice. The content and materials contained on this page are for educational purposes only.
