5 months ago 2 min read

Analysis of Optimism (OP): The 87% Rally Is Just the Prelude


Key Takeaways:

• Price of optimism has broken from a descending wedge.

• OP has completed an ABC correction.

• $1.42 is its most important resistance as of this moment.

Where is OP's Next Destination?

Since hitting an all-time high of $2.24 on Aug. 4, the price of OP has been declining inside of a descending wedge. The decline resulted in a low of $0.65 on October 13. After then, the price of optimism spiked and sharply accelerated its rate of growth.

The price of optimism peaked on October 26 at $1.19. The biggest area of long-term resistance, if the upward advance continues, would be at $1.42.

OPUSDT 1 Day Chart, Source: TradingView, BitcoinMaximus1

Since the daily RSI supports the continued OP price increase, the technical analysis for the daily period is favorable.

The indicator produced a bullish divergence (green line) before to the breakout, which is the first thing that is obvious. The RSI then surged above 50 after breaking out from its downward resistance line (black). Both signals validate the breakout and are linked to bullish trends.

As a result, it is anticipated that the price of Optimism will continue to rise, eventually reaching at least $1.42.

Wave Count Encourages Continued OP Price Rise

The wave count also provides a bullish price prediction, much like the RSI does. The price of the OP completed an A-B-C corrective structure, with waves A:C having a ratio of 1:0.618, according to the most likely count. In such corrections, this ratio is the second most probable.

After that, the wedge breakout demonstrated that the correction was over and a fresh upward advance had started.

OPUSDT 1 Day Chart with ABC Correction, Source: TradingView, BitcoinMaximus1

If a new upward movement started on October 23, the Optimism price is now approaching the conclusion of its recent rise (black). It makes reasonable that the fifth wave would come to a finish near the $1.42 horizontal resistance zone.

After that, a corrective period can follow before the upward movement keeps going.

Since the precise values of the future price high are necessary to calculate the possible bottom, they are only broad strokes of a potential OP price prediction.

On the other hand, a decline below the $0.63 low of October 21 would invalidate the wave count. A new all-time low would be anticipated if that happened.

OPUSDT 6H Chart with 12345 and ABC Prediction, Source: TradingView, BitcoinMaximus1

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