Algorand (ALGO) is down more than 27% as of writing, despite posting substantial gains in the first trading day. The decline in the price of the token follows a bearish market sentiment, which sees the major coins trading in the day.
The token has been rising sharply over the past seven days. It even tried to reach its 6-month high of $0.488 yesterday. However, its rally was cut short and recorded an intraday high of only $0.409.
Algorand’s price plummeted as news of the acquisition of FTX by Binance Surface. This single news has dragged the entire market into the red zone, with Alpha Crypto Bitcoin falling below $18k again.
ALGO $0.28 and $0.42 . consolidated and accumulated between
ALGO price there has been a steep decline From 2022 to May. Since reaching an all-time high of $2.41 in September 2021, the coin has only been known to go down. However, the coin has formed a pattern over the past few months, starting in June.
Specifically, ALGO is swinging around $0.28 and $0.42, the middle range is $0.35. This pointed to the possibility that the coin was through a period of accumulation. The A/D indicator also showed an upward trend, indicating continued buyer interest. Since June, the indicator has been making higher levels.
Conversely, the CMF has followed a bear-bull battle, swinging back and forth between negative and positive values. At press time, CMF was below zero, indicating that no enough money was entering the market. Instead, more money was left.
Can ALGO overcome this range?
It is highly unlikely. The overall market sentiment, driven by the FTX/Binance news, has already pulled ALGO from its uptrend. The RSI is already in the overbought zone and has started a downside move. As of writing, the coin is trading at around $0.2961, a 27% loss on the day.
Formation of a Bearish Order Block above the upper limit In May, refers to the extreme volatility of the market during that month. The range was from $0.41 to $0.49, which means that there is strong resistance for ALGO near the $0.5 level.
What caused the price drop of ALGO and other tokens?
Earlier in the day, after the acquisition of FTX by Binance was revealed, the tokens surged significantly in the crypto market. The news comes after several days of rumors regarding the liquidity issue of FTX and Almeida. However, the news could not sustain the much bullish pressure, causing the market to sink. All profits gained during the day were destroyed by more than 15% across the board.
At the time of writing, FTT has lost over 76% of its value, falling below the $4 threshold. Solana price came under pressure, falling 39% to around $16. ALGO also lost 27%.
BNB was on course to become the biggest winner of the day following the announcement of Binance FTX. However, the recent market sell-off has hit the exchange tokens hard. It is now trading at $288, down 20.54% from its morning high.
Featured image from Pixabay and chart from TradingView.com