Following a significant 45% decrease in value recently, Algorand [ALGO] seems to be experiencing a shift in market sentiment, hinting at a potential price recovery.
The current shift in momentum is being primarily fueled by growing interest from investors and traders, accompanied by a bullish price movement visible on the ALGO daily chart.
Price Movements and Significant Levels for Algorand
Amidst the recent price decline, the asset reached a critical support level at $0.28, a level known for triggering price reversals in the past.
Despite this, the price remained range-bound within a narrow consolidation zone at the support level for several weeks.
As market sentiment begins to change, ALGO has broken out of this range and is displaying signs of a potential price recovery.
According to analysis by CryptoCrypto, if ALGO maintains its current momentum and closes the daily candle above the $0.315 mark, there is a strong chance it could surge by 50% towards the $0.45 level.
ALGO not only discovered support at a crucial horizontal level but also at the 200-day Exponential Moving Average (EMA), strengthening its bullish long-term outlook.
Current Price and Investor Sentiment for Algorand
At the time of writing, ALGO was trading close to $0.31, recording a 9.50% increase in the last 24 hours.
With this price reversal and positive price action, ALGO’s significant transaction volume surged by 166%, indicating increased involvement from both investors and significant holders.
Simultaneously, day traders have expanded their active positions, as evidenced by an 11% rise in Open Interest (OI) over the past day.
Crucial Levels for Liquidation
In addition to these blockchain-based metrics, day traders appear to be overwhelmingly optimistic, with substantial positions leaning towards the long side.
Data sourced from ALGO’s exchange liquidation map revealed that traders with long positions were heavily leveraged at the $0.283 level, holding $3.29 million in long positions.
On the other hand, $0.318 stands out as another important level where traders with short positions were significantly over-leveraged, holding $603,190 in shorts at the time of publication.
These highly leveraged positions are at risk of liquidation in the event of significant price movements in either direction.
When considering these blockchain metrics alongside ALGO’s recent price movements, indications suggest that bulls are presently dominating the asset, potentially paving the way for an impending upward surge.