2023-08-05 00:10:10
Optimism showing big buy signal ahead of massive rally, says analyst
CriptoFácil – Market analyst Akash Girimath suggested that the Optimism () cryptocurrency is on an upward trajectory after recently finding a support floor. Girimath noted that the Layer 2 (L2) token has started its ascent and has appreciated 63% in less than two months.
“Optimism (OP) price has produced six consecutive lows and three highs since its inception in May 2023,” said Girimath. “Connecting the peaks and troughs using trendlines reveals a parallel upward channel at play. The 67% drop from its all-time high of $3.29 has found support at the lower trend line of the parallel channel.”
The reaction from this trendline boosted the price of Optimism (OP) by 63%, where it currently trades at $1.72.
According to Girimath, the Layer 2 token’s indicators are all signaling buy. He points out that the earliest signal for the bulls was the Wave Trend indicator, which triggered a bullish overlay.
“More recently, the Relative Strength Index (RSI) rebounded from the mid-level at 50, signaling a resurgence of bulls. Lastly, the Awesome Oscillator (AO) histograms turned above the zero line, suggesting what the RSI already hinted at – a return of bullish momentum.”
The 63% rise saw the OP break through the $1.36 hurdle and turn it into a support level.
Girimath predicts that as buyers continue to buy lower timeframe lows with higher timeframe bullish indicators, the Layer 2 token is destined to hit the $2.07 hurdle.
Optimism
“Investors should expect the Optimism (OP) price to consolidate between the $2.07 and $2.85 hurdles as it also coincides with the midpoint of the parallel channel,” predicts Girimath.
Layer 2 tokens have been a favorite choice since their inception. Girimath points to the example of , whose native MATIC token appreciated by 17,000% during the 2021 bull run.
“While market conditions or sentiment are nowhere near the 2021 high, the fundamentals of the Optimism project are sound,” argues Girimath. “Even if Optimism price experiences a fraction of the traction that Polygon’s MATIC had, OP could pull a 600% move.”
Girimath warns that, while the conservative perspective makes sense, the extreme case scenario should be considered with caution.
“The cryptocurrency space is where many altcoins experience high volatility. For example, the investor who bought $8,000 in USD turned that into $5.7 billion during the 2021 bull market.”
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