Optimism (OP) Price Holds Above Previous ATH, Will Uptrend Continue?
The Optimism (OP) price has confirmed the previous all-time high (ATH) as support. As long as the price holds above this level, the uptrend will soon continue.
The Optimism (OP) price has been trading inside an expanding wedge since June 2022. The price has tested both the wedge’s support and resistance several times, confirming the validity of the pattern.
During the week of December 18 to 24, 2023, the OP price broke out above the $3.1 resistance area with a large bullish candle, marking the continuation of the uptrend.
However, the uptrend failed to push the price to the pattern’s resistance at $4.9, suggesting selling pressure at higher levels.
Nevertheless, the OP price has held above the previous resistance area at $3.1 for the past 3 weeks (green arrow). This indicates that sentiment has shifted from selling on rallies to buying on dips.
The weekly RSI indicator is holding above the previous ascending resistance line and above 50, indicating that the bulls still have the upper hand.
Therefore, the OP price is likely to continue rising towards the long-term wedge’s resistance at $4.9. This figure corresponds to a 51.32% increase from the current price.
The daily chart shows that OP price has been trading inside a range from $3 to 4.2 since December 22, 2023. This indicates a balance between bulls and bears.
Although the daily RSI indicator has dropped below 50, it has created a potential hidden bullish divergence (green line). This divergence occurs when the RSI indicator drops but the price does not drop sharply and often leads to a continuation of the uptrend.
Therefore, the OP price is likely to bounce from the range’s support level and rise to the range’s resistance at $4.2.
The most likely prospect shows that OP price will continue to rise in the near future. The nearest target is $4.2 and higher to $4.9.
The bullish view will be invalidated if the OP price breaks down below the range’s support at $3 on the daily timeframe.
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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