Algorand Price Forecast: ALGO Eyes Further Upside as Falling-Wedge Retest Holds

Algorand (ALGO) holds near $0.136 on Thursday, approaching a critical support level. A successful retest of this area could indicate further bullish momentum. The price recently broke above a falling wedge pattern, suggesting a potential upward move.

On-chain metrics indicate increasing activity in the Algorand ecosystem. Total Value Locked (TVL) on Algorand rose to $54.70 million since mid-December, signaling growing adoption. Derivatives data also support a positive outlook, with large whale orders and strong buy dominance observed.

Funding rates on derivatives exchanges show a shift in market sentiment. Long positions now dominate, with the OI-Weighted Funding Rate at 0.0084%, up from a negative value earlier in the week. This flip historically has led to sharp price rallies in Algorand.

Why Did This Happen?

Algorand's price broke above a falling wedge pattern in early January, a technical formation that often signals a trend reversal. The wedge broke higher on Sunday, and a slight pullback in the middle of the week has left ALGO near the broken trendline.

If this trendline holds, it will confirm a bullish breakout. The 50-day EMA is at $0.133, which aligns with this key support level. A successful hold would suggest a potential move toward $0.152.

Market indicators remain in a strong bullish position. The Relative Strength Index (RSI) on the daily chart is at 59, above the neutral level of 50. This suggests that buying pressure is increasing. The MACD indicator also supports the bullish case, showing a crossover and rising histogram bars above the zero line.

A failure to hold the $0.133 level, however, could push ALGO toward $0.120. This would invalidate the bullish case and shift focus to a more bearish scenario.

What Are Analysts Watching Next?

Analysts are closely tracking the 50-day EMA at $0.133 as the key support level. A close above $0.152 would extend the bullish case toward $0.186. A move above this threshold would confirm a breakout and suggest continued upward momentum.

On the derivatives side, the OI-Weighted Funding Rate is a closely watched metric. A sustained increase above 0.0084% would reinforce the long-biased sentiment in the market. This could lead to further buying pressure and price expansion.