The altcoin market started July on a positive note. Accompanied by US inflation data for July 12, Bitcoin price touched $31,000 at one point. However, the latest analysis of Algoran (ALGO) shows that the price is trading in a ‘do or die’ zone that will lead to a sharp decline.
Algorand (ALGO) price at critical juncture
ALGO price has fallen below a long-term descending resistance line since September 2021. The fact that the price is trading below such a long-term structure indicates that the trend is bearish. This line largely blocked the price in April 2023 and extended the bearish move to an all-time low of $0.09 in June. When measured from the highest point, this was a 97% decrease.
The price later recovered somewhat from this region. So he created a long bottom wick (green icon) that is considered a sign of buying pressure. Despite this wick, ALGO has yet to initiate any significant upward movement. So far, the price has traded below the resistance line for 602 days.
Also, the weekly RSI is bearish. If the RSI is above 50 and the trend is up, the bulls still have the advantage. However, the reverse is true if the RSI is below 50. Currently the RSI for ALGO is below 50 and falling, both signs of a downtrend.
cryptocoin.com As we have reported, the announcement of Algofi, one of the largest Algorand-based DeFi platforms, was also a blow for TVL.
What’s next for ALGO?
ALGO price is currently trading just above the 0.618 Fib retracement support level at $0.11. The Fibonacci retracement levels theory suggests that after a significant price move in one direction, the price will partially retrace or return to a previous price level. The 0.618 Fib level is crucial in determining whether the decline is corrective.
If the price closes below that, it usually means that the trend is bearish. But if the price bounces, it’s a sign that the correction is complete. So, this will probably apply to ALGO. A break below the area could lead to a drop to $0.09, while a bounce would likely test previous June highs at $0.14.
As a result, the reaction to the $0.11 area will likely determine the future ALGO price prediction. A break below this could lead to a quick drop to $0.09 according to trader Valdrin Tahiri. On the other hand, a bounce will likely lead to an increase to $0.14.
3 altcoins to watch this week
In the rest of the article, let’s take a look at 3 projects that are preparing for important technical developments this week. First, SHIB entered a descending trend channel at the beginning of February, pushing its price below its annual opening level. However, a breakthrough from this channel took place over the weekend, signaling a potential reversal.
However, confirmation of the breakout is still pending. While Shiba Inu price managed to stay above the trend channel yesterday, the bulls are still wary of making a sudden move towards the 23.6% Fibonacci level at $0.00000834. A break above this will be confirmation of a trend reversal.
Left (LEFT)
Solana (SOL) became the prominent name in the altcoin market last week. Thus, it has recorded an impressive 39% price increase in the last 12 days. This surge pushed the SOL to the critical resistance level represented by the 200-day EMA.
Breaking this level has been a constant challenge for SOL since April 2022. But recent developments offer hope for a potential breakthrough. SOL price is currently trading at $22.35, crossing the 200-EMA at $21.98. A one-day close above this price level will be largely bullish.
SOL’s rally is particularly notable given the setbacks it has faced due to the drama of FTX and the SEC’s classification as securities. If the 200-day EMA is breached, the 50% Fibonacci retracement level and the yearly high of $27.00 will serve as next targets for a prolonged rally that could yield an additional 22% profit to traders.
Polygon (MATIC)
Recent developments around MATIC aroused interest among investors. The announcement of former Chief Legal Officer Marc Boiron as the new CEO created a positive mood in the community. On-chain data points to a significant increase in social volume following the news. This indicates increased interest and potential bullish sentiment for the price of MATIC.
Technically speaking, MATIC has seen a 40% increase since the local low in June. The price is currently below the 23.6% Fibonacci retracement level and a break above this level could potentially pull the MATIC towards the 200-day EMA and the 38.2% Fibonacci retracement level offering a 22% rally. However, breaking the initial Fibonacci resistance at $0.756 is a crucial step to watch for potential bullish momentum.
Which altcoin projects are at the forefront in the long run?
Analyst Rudy Fares answers this question for the time frame to 2024. Cardano (ADA), for example, suffered heavy losses in the crash in early June. But a lot has happened technically in recent months. The Vasil update has increased scalability in the Cardano network. Also, more and more DeFi applications are being created on Cardano. This is why the ADA token is seen as one of the best cryptocurrencies for the coming summer.
Tron (TRX)
Tron was also hit hard by the crash in early June. However, the price has recently managed to recover very well from its early June losses. There is strong growth potential renewed in the coming weeks and months.
Ethereum (ETH)
Ethereum is naturally known as the main Bitcoin alternative. It’s been around for a while. It also has a solid infrastructure supporting dApps and is the second largest crypto by market cap. Ethereum has switched from the PoW mechanism to PoS, which in some areas is considered better than Bitcoin’s current PoW.
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