Key Takeaways:
- Ethereum competitor Algorand gained 10% in the past 24 hours, and could see more gains in 2022.
- ALGO flashed a bullish Pennant on the daily chart, and an Ascending channel on the weekly time frame.
- Skybridge Hedgefund launched a $1 million Algorand fund on Dec 1.
YEREVAN (CoinChapter.com) – ALGO, the native token of smart contract platform Algorand, gained 10% in the previous 24 hours, despite the red crypto market. Technicals suggest ALGO could see another 130% uptrend in Q1 2022, based on two setups on the charts.
ALGO’s bullish daily chart
Algorand has been in consolidation since rallying 260% and topping out at $2.55 on Sep 13. The latest uptrend did not change the price action’s course, and ALGO is still in consolidation. However, it printed a bullish Pennant on the daily chart.
The Pennant typically occurs after a rally and features two trendlines constricting the price. The resistance line prevents sharp breakouts, while the support hinders plunges.
Also read: ALGO logs 45% intraday rally following Algorand's deal with the El Salvador government.
The formation represents an accumulation period and forecasts a bullish continuation. When ALGO exhausts the Pennant, it is likely to start on a new leg up and possibly reach $4.00 in value.
Additionally, Algorand’s in-house token flashed bullish signs on the weekly chart.
Algorand in an Ascending Channel
As mentioned, ALGO appeared to form another pattern on the weekly chart: the Ascending Channel. The Channel featured two trendlines nearly parallel to each other. Both lines prevented sharp price swings and enveloped the cryptocurrency since late 2019.
ALGO retested the Channel’s resistance in September. Thus, if the digital asset’s ongoing dependency on the setup, it could retest the said resistance again in Q1 2022, reaching $4.00, which is compliant with the daily chart prediction.
However, the token could experience a further correction before making it up to the Ascending Channel’s resistance and retest the support again, at $1.40.
Despite the lengthy consolidation, the relative strength index (RSI; momentum indicator at the bottom) looked strong and charted at 55. An RSI between 50 and 70 typically indicates the traders’ high confidence in an asset and willingness to invest.
Also read: Bitcoin(BTC), Ethereum(ETH) sideline hawkish Fed to maintain the bullish course.
Overall, the digital asset’s possible breakout towards $4.00 would be an over 130% uptrend from the current $1.72 value.
What’s new with Algorand?
Despite the ubiquitous correction on the market, Algorand made a foray into the top 20 cryptocurrencies, with a market cap of $11,5 billion. Some experts are bullish on the digital asset, singling it out as substantial competition to Ethereum. Former White House Director of Communications Anthony Scaramucci was one of them.
As the Skybridge Hedgefund Manager, Mr. Scaramucci appeared on CNBC on Dec 2. He stated that his firm launched a $1 million Algorand fund. He initially announced the news during DeCipher, a two-day event in Miami featuring over 3000 participants, both actual and virtual.
The executive pointed out that he could see Algorand “flip” Ethereum as the leading smart contract platform. He cited several reasons to back his opinion, including the platform’s “negative carbon footprint,” faster transactions, and lower fees.
Algorand tweeted feedback after the event and posted a quick rundown.
Also read: The crypto dip: Buying opportunity or the start of a bubble burst.
Regardless of whether Algorand is the ‘next Ethereum’ or not, it looks poised for more gains in the upcoming year. The optimistic outlook is based on technical setups on the daily and the weekly chart.
