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Optimism: Examining if OP can surpass $0.72 and race to…
The buying pressure over the past two days has been encouraging, but an OP rally past $0.72-$0.74 was not guaranteed.
Since mid-May, Optimism [OP] has been trading within a range formation (white) between $0.59 and $0.84. A bullish structure break on the daily chart (cyan) encouraged a bullish bias among traders. The recent surge of 20% since testing the $0.59 support level could be seen as a positive development.
However, the rally’s momentum has been underwhelming at press time, with an MFI reading of only 44 and an OBV struggling to trend higher. This equilibrium in buying and selling pressure, reflected by the lackluster price action, suggested that traders and investors should not expect a breakout beyond $0.84.
On the other hand, a short-term rally past $0.72 to race towards the mid-range resistance is possible. Data from Coinalyze revealed that there has been a significant buildup of liquidity around this level. The recent short liquidations have accrued just above $0.72, making it more likely for the price to move higher.
In addition, a Bitcoin [BTC] rally past $110k and continued upward momentum could propel Optimism beyond its local resistance. A concurrent surge in OP’s Open Interest and funding rate may also support this notion.
As the market waits with bated breath for the CPI report release, it is unclear if Optimism can surpass $0.72 and continue its rally.
Source: ambcrypto.com
