- Algorand price shows rejection from a critical barrier, which could entice a sweep of 2020 liquidity levels.
- ALGO shows an uptick in large transactions, which has resulted in significant selloffs this year.
- A flip of the 8-day exponential moving average into support could invalidate the bearish stronghold
Algorand price continues to pack on negative returns for November. As the final days of the month approach, knife-catching bulls are skimming through all digital assets looking for a last-minute opportunity. Unfortunately, the ALGO price may not be a top pick to bounce anytime soon, as the technicals show confounding evidence of bearish control.
Algorand price looks problematic
Algorand price has endured a 47% decline since the beginning of the month. As the selloff progresses, the price action has become congested near $0.20 as the bulls and bears grappled over a week over a trading range.
On November 23, the bulls printed a morning star pattern, signalling for sidelined bulls to enter the market. Classical price action traders likely placed their stop under the monthly low at $0.225 in hopes of a retaliation rally against the bearish onslaught.
On November 27, the bulls bolstered their first attempt at reconquering the 8-day exponential moving average (EMA), but unfortunately, the price was rejected and had been trading beneath the indicator ever since.
Algorand price currently auctions at $0.233 and has yet to invalidate the bullish signal. However, on-chain metrics hint that the move south could be coming soon. According to Into-the-Blocks' Large Transactions by Volume Indicator,
The indicator had a similar reading on August 15 and September 23 at $375.8 and $297.4 million. Interestingly enough, the Algorsand price fell by 23% and 27% in less than a week after indicators’ influx spikes were displayed.
IntotheBlock's Large Transactions Indicator
Algorand price is already down 20% since the indicator's reading but can continue to fall as the rejection of the 8-day EMA could provoke the breach of the newfound monthly low at $0.237. A breach of the low would likely promote further downtrend price action targeting the 2020 liquidity at $0.224 for an additional 8% dip in market value.
ALGO/USDT 1-day chart
The bulls will need to conquer the 8-day EMA to secure the confidence amongst bulls and invalidate the bearish thesis. A breach above the moving average could promote a rally towards the 21-day simple moving average of $0.270, resulting in a 17% increase from the current Algorand price.
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