Optimism (OP) Price Hits New ATH, How High Can It Rise?
The price of Optimism (OP) has broken above a significant resistance zone and reached a new all-time high (ATH) this week.
However, trading within a long-term pattern may limit its upward momentum in the short term.
The price of Optimism (OP) has been trading within a broadening wedge since June 2022. The price has tested both the support and resistance of the wedge several times, confirming the validity of the pattern.
During the week of October 16 to 22, 2023, the OP price bounced up from the support line of the pattern (yellow arrow). Initially, the upward movement was gradual but accelerated last week. This helped OP break above the $3.1 resistance zone with a large bullish candle, reaching a new all-time high of $4.2 this week.
Currently, OP is in the process of confirming the $3.1 zone as support (green arrow). If successful, it may continue to rise towards the next resistance zone at $4.7, formed by the Fib retracement of 1.618 of the recent decline and the wedge’s resistance.
The RSI indicator has entered the overbought zone and is sloping upward, indicating that the uptrend may continue.
Coincidentally, the peak of the previous uptrend (green ellipse) was created at the Fib retracement level of 1.618 of the previous decline.
Therefore, the $4.7 level may provide formidable resistance when approached.
However, breaking above the $4.7 level could help OP quickly rise to the next resistance at $7.1 (Fib 2.618).
The 4-hour chart shows that OP is ready to move higher. This is indicated by the price action and RSI indicator.
OP has successfully flipped the previous small resistance zone at $3.5 into support, suggesting buying strength at a lower levels.
The 4-hour RSI has risen from the 50 level, creating a bullish divergence.
The most likely scenario suggests that the OP price will continue to rise in the near future. The potential target for this movement is $4.7.
Breaking above this level could help the price quickly rise to $7.1.
Disclaimer: Please note that this article is for informational purposes only and should not be taken as investment advice. As an investor, it is important to do your own research before making any decisions. We are not responsible for any investment decisions you make based on this information. Not Financial Advice.
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