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Optimism [OP] hit a key resistance, but an extra 35% hike is possible if…

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Optimism [OP] hit a key resistance, but an extra 35% hike is possible if...

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Disclaimer: The information presented does not constitute financial, investment, trading, or other types of advice and is solely the writer’s opinion

  • Optimism faced a key hurdle at $3.225.
  • A whale category was primarily responsible for selling pressure witnessed at press time.

Optimism [OP] defied Bitcoin’s [BTC] price action and hiked 33% between Wednesday and Friday (22 and 24 February). One of the driving factors behind the rally was the announcement of the Optimism Superchain. A bold step to push Ethereum to an internet-level scale to drive mass adoption. 

However, the rally reached a key resistance level of $3.225 at the time of writing, which could delay the momentum uptrend.

Read Optimism [OP] Price Prediction 2023-24

When can bulls re-enter the market?

Source: OP/USDT on TradingView

Optimism’s [OP] price action in February chalked a parallel channel. It oscillated between $3.225 and $2.1 but hit the upper boundary and could retract, clearing some of the gains made in the last few days. 

Is your portfolio green? Check out the OP Profit Calculator

Long-term bulls could wait to re-enter the market if OP dropped to $2.837 or the channel’s mid-level of  $2.657. However, the ideal entry for a long position would be $2.479 or the channel’s lower boundary of $2.1.

The target would be the overhead resistance level of $3.225 or a bullish breakout target of $4.367, based on the channel’s height. A hit on the bullish target would offer an extra 35% hike.

A break below the parallel channel’s lower boundary of $2.1 would invalidate the bullish thesis. The drop could be checked by $1.911 or $1.500. 

The OBV (On Balance Volume) has been rising since the beginning of 2023, showing a genuine demand for the token. Although RSI exhibited a divergence to price action, the value was above 50, hence bullish. 

OP saw a high positive weighted sentiment, but …

Source: Santiment

According to Santiment, OP registered a spike in sentiment, showing the recent announcement on its Superchain received positive social interactions. Similarly, active addresses rose in the past 24 hours, indicating a rise in trading volume and overall buying pressure that boosted the uptrend. 

Notably, the selling pressure seen at press time after OP hit the overhead resistance came from a key whale category holding 100K – 1M OPs.

However, a major whale holding over 1 billion OPs, 70% of the supply, was accumulating. Other whales controlling 13% and 11% of the supply were also accumulating. This suggests that the bullish run could continue. 

However, caution is advised given that $1.9M short-positions and $1.5M long-positions have been liquidated in the past 24 hours, according to Coinanalyze. 

Source: Santiment


Saman Waris works as a News Editor at AMBCrypto. She has always been fascinated by how the tides of finance and technology shape communities across demographics. Cryptocurrencies are of particular interest to Saman, with much of her writing centered around understanding how ideas like Momentum and Greater Fool theories apply to altcoins, specifically, memecoins. A graduate in history, Saman worked the sports beat before diving into crypto. Prior to joining AMBCrypto 2 years ago, Saman was a News Editor at Sportskeeda. This was preceded by her stint as Editor-in-Chief at EssentiallySports.
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