Algorand reaches fresh two-year high supported by bullish on-chain metrics
|- Algorand’s price extends its rally by over 15% on Friday and reaches a fresh two-year high after surging more than double-dight the previous day.
- On-chain data paints a bullish picture as ALGO’s Open Interest and TVL are rising to record levels.
- A weekly candlestick close below $0.276 would invalidate the bullish thesis.
Algorand (ALGO) extends its gains and trades higher by more than 15% at the time of writing on Friday, breaking above the year-to-date high of $0.33 established in March and reaching levels not seen in over two years, after rallying 54% the previous week. On-chain data support for the bullish outlook is strong, as ALGO’s Open Interest (OI) and Total Value Locked (TVL) are rising to record levels, indicating a further rally in the upcoming days.
Algorand bulls eyes for $0.45 mark
Algorand price extends its ongoing rally, surging more than 30% so far this week after rallying 54% the previous one. At the time of writing on Friday, it trades higher by more than 15%, reaching levels not seen since November 8, 2022.
If ALGO continues its upward momentum, it could extend the rally to retest its October 2022 weekly high of $0.45.
However, the Relative Strength Index (RSI) momentum indicator on the weekly chart stands at 79, signaling overbought conditions and suggesting an increasing risk of a correction. An RSI’s move out of overbought territory could signify a pullback.
ALGO/USDT weekly chart
Crypto intelligence tracker DefiLlama data shows that Algorand’s TVL increased from $125.25 million on Tuesday to $157.97 million on Friday, constantly rising since early November.
This 26% increase in TVL indicates growing activity and interest within the Algorand ecosystem. It suggests that more users deposit or utilize assets within ALGO-based protocols, adding credence to the bullish outlook.
ALGO TVL chart. Source: DefiLlama
Algorand’s Open Interest (OI) is also supporting the bullish outlook. Coinglass’s data shows that the futures’ OI in ALGO at exchanges rose from $75.69 million on Tuesday to $95.87 million on Friday, the highest level since November 2022. An increasing OI represents new or additional money entering the market and new buying, which suggests a rally ahead in the Algorand price.
ALGO Open Interest chart. Source: Coinglass
Lastly, the Annual Percentage Yield (APY) associated with ALGO investments has sparked interest, particularly during Thanksgiving, suggesting investors are keen to capitalize on lucrative returns.
Even though on-chain metrics and technical analysis support the bullish outlook, if the ALGO weekly candlestick closes below the $0.27 weekly support level, the bullish thesis will be invalidated, leading to a price decline to retest its weekly low of $0.25.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.