Algorand (ALGO) is poised for a breakout as technical and on-chain signals simultaneously improve.

Algorand price (ALGO) remains sideways around the 0.136 USD level on Thursday, as it approaches a key support zone in the market. Maintaining this price level could open room for a subsequent recovery. Notably, investor sentiment is gradually improving, as reflected by on-chain metrics and derivatives markets indicating more positive expectations from traders. From a technical perspective, the overall picture still leans toward an uptrend, with bulls aiming to conquer the 0.150 USD level in the short term.

On-chain and derivatives data for Algorand show improved sentiment

According to data from DefiLlama, the total value locked (TVL) in Algorand has maintained a steady upward trend since mid-December, currently reaching approximately $54.7 million. This development indicates capital flows returning to the Algorand ecosystem, reflecting increasing user interest as they actively deposit and deploy assets on protocols built on the ALGO platform.

TVL chart of ALGO | Source: DefiLlama Meanwhile, aggregated data from CryptoQuant continues to reinforce a positive outlook for the market. Both spot and futures markets for ALGO show large buy orders from whales, amid a clear bullish dominance. This signals that ALGO’s price could enter a new upward phase in the coming days.

Source: CryptoQuant In the derivatives market, indicators also favor a bullish scenario. Algorand’s funding rate continues to trend positively, with OI-Weighted Funding Rate data from Coinglass showing that the number of traders betting on price increases exceeds those expecting declines. Notably, this index has turned positive since the beginning of the week and rose to 0.0084% on Thursday, indicating that longs are willing to pay fees to maintain their positions. Historically, instances where the funding rate shifts from negative to positive and continues to expand are often accompanied by significant price rallies for Algorand.

Algorand funding rate chart | Source: Coinglass

Algorand Price Forecast: ALGO could rise if key support holds

Algorand’s price broke out of the descending wedge pattern — formed by connecting highs and lows since early August — on Sunday, then increased nearly 5% over the next two sessions. However, the rally paused as ALGO experienced a slight correction midweek, and by Thursday, the price was oscillating around the recently broken trendline, indicating the market is testing this level again.

In a positive scenario, if the trendline — close to the 50-day exponential moving average (EMA) at 0.133 USD — continues to hold as support, ALGO is likely to regain upward momentum and target the daily resistance zone at 0.152 USD. Successfully closing above this level could open up more room for gains, with the next key resistance at 0.186 USD.

Daily ALGO/USDT chart | Source: TradingView From a technical standpoint, the RSI indicator on the daily timeframe is at 59, above the neutral 50 level, reflecting increasing bullish momentum. Additionally, the MACD has shown a bullish crossover, while green histogram bars continue to expand above the neutral line, further supporting the bullish outlook.

Conversely, if the trendline fails to hold as support, selling pressure could intensify, pushing ALGO’s price back toward the support zone around 0.120 USD.

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