Many cryptocurrencies are currently undergoing a corrective phase. While this may appear negative at first glance, it can create opportunities for market participants who did not engage in the previous move.

Algorand is one such example. The project delivered an impressive performance in July, with its value rising by 100%. Since then, the price has retraced into the discount zone, a level where potential entries could appear more favorable.

Algorand technical analysis

ALGOUSD - 1 Day Time Frame

Buying a cryptocurrency solely because its price is falling, without specific technical confirmation, can be highly risky. A structured approach requires clearly defined conditions that support the entry idea.

One method often applied combines two elements:

a) Liquidity sweep – when larger market participants target areas of high volume, often below notable lows.

b) Close above resistance – a zone initially acting as bearish supply, but once surpassed, could indicate a shift toward bullish price delivery.

In Algorand’s case, the setup appears potentially constructive. The price has already swept Sell-Side Liquidity below the 0.5 Fibonacci retracement level – the discount zone. This presents a more favorable risk-to-reward profile compared to entries above the 0.5 level, often referred to as the premium zone.

Algorand price target

A potentially favorable condition for buying ALGO would be a daily close above the resistance zone, highlighted in orange on the attached chart. If this occurs, price targets could align with selected Buy-Side Liquidity levels.

A protective Stop Loss may be considered just below the lowest internal low of the current correction – presently near $0.225.