With mid-December now behind us, the cryptocurrency market continues to face sustained bearish pressure. Algorand (ALGO) is one asset that clearly reflects this broader decline. In market conditions such as these, price action often highlights several key technical parameters that both confirm the prevailing downtrend and, over time, may begin to signal a potential shift in direction.

Algorand technical analysis

ALGOUSD - 4 Hour Time Frame

At its core, the current setup is defined by a bearish market structure, marked by two clear reference points: a lower low and a lower high, both highlighted with blue horizontal lines on the attached chart. Within this structure, three distinct resistance zones have formed, indicated in orange.

Given that the price is currently positioned some distance above the most recent lower low, the development of a bullish corrective move within the broader bearish trend remains a plausible scenario. The first technical indication of such a correction would be a four-hour candle closing above the lowest resistance zone. If this condition were to occur, a potential long exposure could be considered, with risk defined below the internal swing low.

Should bullish momentum begin to develop, close attention would then be required around the second resistance zone. A renewed bearish reaction at this level could increase the probability of downside continuation and reinforce the dominant trend.

Conversely, if price action fails to respect this zone and instead achieves a confirmed close above it on the four-hour timeframe, the corrective move could extend further. In that case, focus would shift toward the third and highest resistance zone. A sustained break above this final area, combined with a move above the prior lower high (the upper blue line), would signal a structural transition toward more constructive market conditions.

Such a shift could open the path toward higher historical levels, including the July high and potentially this year’s peak. It is worth noting that a return to the yearly high would represent a move of more than 300% from current levels; however, such outcomes remain contingent on broader market conditions and confirmation of a full structural reversal rather than assumed continuation.