Summary
TLDR: Optimism (OP) price surged 10% in 24 hours but may correct by 15% due to selling pressure and high MVRV ratio. Potential resistance at $4. Failed breach could result in price falling to $3.40 or $3.20. However, a Golden Cross on the 4-hour chart indicates a potential bullish trend reversal, with a 20% rally sending OP to $4.50.
Key Points
1. Optimism (OP) price noted a 10% rally in the past 24 hours, and on a technical level, it is poised for further rally.
2. However, considering the broader market cues, OP might end up correcting by 15%. Here is why.
3. Optimism Faces Bearish Pressure
– Optimism price, trading at $3.78 at the time of writing, is reeling from a 10.81% rally observed in the last 24 hours. In the short-term timeframe, this marked considerable profits for investors, preparing for further rise, which likely may not come.
– The reason is that the recent rally intensified the selling pressure as profits surged. This can be noted in the Market Value to Realized Value (MVRV) ratio. The 7-day MVRV ratio gauges investors’ profit/loss on assets bought in the last week.
– Optimism’s MVRV at 10.16% suggests recent buyers’ profits are up 10.16%, likely to sell, signaling a potential downturn. MVRV between 3% and 9% signifies a danger zone for OP, hinting at potential corrections.