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Cryptocurrency News Articles
Layer 2 Solution Optimism (OP) Positioned for a Major Price Breakout, Market Analyst Says
Oct 31, 2024 at 04:30 pm
Layer 2 solutions are expected to note major growth in the coming months, according to market analyst Michaël van de Poppe.
Optimism (OP), a prominent Layer 2 protocol, might be gearing up for a significant price breakout, according to market analyst Michaël van de Poppe. In fact, Poppe is optimistic that the token is setting the stage for a potential move towards the $3 price mark.
In a recent analysis, Poppe highlighted key levels to watch for OP. He stated, “Once it reaches the $1.80-1.90 range, a breakout to $3 is likely.”
Moreover, he noted the ongoing accumulation and rising higher lows as early signs of a bullish trend, paving the way for a potential move north.
Chart analysis: Higher lows and a crucial resistance zone
A glance at OP's price chart reveals that the token has largely been trending downwards. However, it seems to be building a base around its current levels.
A technical analysis suggests an accumulation phase, characterized by the creation of higher lows - a sign of strong buying interest. The price is also approaching a resistance zone around $2.27, which is a crucial breakout area.
If the price manages to break through this resistance, it could shift market sentiment towards a more bullish outlook.
Furthermore, the presence of an ascending trendline adds support to the possibility of a breakout. On the price chart, momentum appears to be steadily building as buyers absorb selling pressure, creating a strong foundation for a potential move upwards.
OP price might be targeting $2.68-$2.80 after breakout
In the event that OP breaks above the $2.27 resistance zone, the next potential target is estimated to be between $2.68 and $2.80. This target range represents an 18% profit opportunity from its press time breakout point.
This area could serve as a new resistance level, as traders may look to take profits within this range. The market has also been showing signs of a bullish buildup, as the price continues to consolidate near the horizontal resistance.
On-chain metrics : Rising network engagement, large holder activity
Recent on-chain data from IntoTheBlock supports the optimistic outlook for OP. Over the past week, new addresses have risen by 32.21%, active addresses by 50.19%, and zero-balance addresses by 22.56%, indicating rising network engagement.
Despite this growth, the token’s price remains relatively stable, suggesting that the network expansion may be laying the groundwork for a bullish trend.
Moreover, large transaction volumes fluctuated between 1.5k and 2.07k over the past week, with a slight decline towards the week's end. This trend indicates sustained interest from major holders, although the dip might reflect caution or potential profit-taking.
Exchange netflows suggest potential short-term selling pressure
The exchange netflows for large holders of OP have risen by 470.01% over the past week, indicating that more tokens are moving to exchanges. This could signal potential selling pressure in the short term.
On the other hand, the 30-day and 90-day netflows have been heavily negative, suggesting prior accumulation and longer-term bullish sentiment.
Finally, data from DeFiLlama reveals that Optimism's Total Value Locked (TVL) stood at $684.51 million at press time, with a stablecoin market cap of $1.01 billion.
Also, over the last 24 hours, the network recorded $13,070 in fees and $12,901 in revenue, alongside $11.27 million in inflows. Together, these metrics indicate steady growth in the protocol's ecosystem amid ongoing user interest.
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The information provided is not trading advice. kdj.com does not assume any responsibility for any investments made based on the information provided in this article. Cryptocurrencies are highly volatile and it is highly recommended that you invest with caution after thorough research!
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