• Algorand has experienced a relief rally of 16.5% in the past six days, though it has still lost 60% of its value in the past two months.
• There is an order block of resistance at $0.1874 that must be broken in order to invalidate the bearish market structure.
• Bitcoin is showing resistance at the $17.3k-$17.6k area, and bears can enter short positions once this area is broken.
Algorand has seen a relief rally of 16.5% within the past six days of trading, after reaching a low of $0.1598 on 30 December. Despite this, ALGO has still lost close to 60% of its value in the past two months. This move has been appreciable, but it has yet to break the higher timeframe trend of Algorand, which remains bearish.
At press time, Algorand is trading at $0.1874 and faces a region of stiff resistance. This resistance is highlighted in red and is a bearish order block on the daily timeframe. This order block has confluence with the horizontal level at $0.1874 and must be broken in order to invalidate the bearish market structure. The Relative Strength Index (RSI) has yet to breach the neutral 50 mark, and the On-Balance Volume (OBV) has not shown large gains in the past two weeks, indicating that this bounce is ripe for selling. A daily trading session close above the order block at $0.195 would invalidate this bearish notion and shift the trend in favor of the bulls.
Bitcoin is currently trading at $16.8k and is showing resistance at the $17.3k-$17.6k area. Although eager bears can wait for another move higher before entering short positions with conviction, a break above this area could herald another small rally for the altcoin market.