Algorand (ALGO) is showing signs of a potential bullish breakout, according to a recent technical analysis by a Forex Trading analyst. The expert examined short-term trends, Fibonacci retracement levels, and fractal comparisons to assess ALGO’s next moves.
While acknowledging possible downside risks, they emphasized strong support levels and a bullish wave structure. The key confirmation level for a rally remains a break above $0.031. If ALGO holds its current support, it could see an explosive move soon.
The analyst highlighted ALGO’s recent correction phase after an impulse rally. They noted that the price retraced to the 61.8% Fibonacci level, a typical signal for a bullish continuation. Based on this setup, they suggested that ALGO could be forming a five-wave pattern, with a strong third wave potentially incoming. If the price breaks above $0.031, it could confirm the start of this next impulse.
According to the expert, a move beyond this level would indicate a wave 3 breakout, historically associated with rapid price increases. However, failure to hold current levels could lead to a different wave structure, possibly delaying the expected uptrend.
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ALGO Bullish vs. Bearish Scenarios
The analyst acknowledged the possibility of a bearish case but leaned toward a bullish outlook. If ALGO’s recent movement is an ABC correction rather than an impulse wave, it could trigger another downturn, potentially setting new lows. This scenario would invalidate the expectation of a bull run in this cycle.
However, the expert argued that the initial move down appeared corrective rather than impulsive. This strengthens the bullish case, as corrections often lead to strong recoveries. If ALGO maintains its support, a significant upward movement could follow.
To reinforce their analysis, the analyst compared ALGO’s price action to a previous bull run from Orchid (OXT) in 2021. They noted similarities in the structure, including a choppy uptrend, a quick drop, and a strong recovery. If ALGO follows the same trajectory, it could experience a substantial price rally.
The expert pointed out that historical fractals often repeat in crypto markets. If the pattern holds, ALGO might be positioned for an aggressive breakout in the near term. However, confirmation above key resistance remains crucial.
Algorand Wave Structure and Future Price Projection
Looking at ALGO’s chart differently than the usual Elliott Wave approach, the analyst spots a series of nested wave patterns that paint a super bullish picture. The deep pullback, might actually be good news – it could mean smoother sailing ahead with shallower dips. What’s really getting attention is the potential for a massive wave 3 surge.
The weekly and daily charts show solid support levels, and as long as ALGO holds these, the bullish setup stays intact. A break above previous highs could spark a parabolic move.
After completing what looks like a healthy correction at Fibonacci levels, ALGO seems to be gearing up for its next big push. Keep an eye on $0.031 – breaking above that would confirm the bulls are back in charge.
Historical fractal comparisons suggest that if the pattern repeats, a significant rally could follow. Strong support levels further reinforce the bullish case, with wave 3 potentially leading to substantial price gains.
While the analysis presents a compelling case for an ALGO breakout, confirmation remains key. If price action aligns with the expected wave structure, a major rally could be imminent.
Read also: Litecoin (LTC) Could See Further Decline as 3-Month Support Starts to Weaken
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