Optimism (OP) Pumps 87% From the Bottom, Will the Rally Continue?

    OP price is likely to have completed the correction by breaking above a descending wedge. A rise above $1.42 could accelerate the upward movement significantly.

    Descending wedge

    OP price has been falling inside a descending wedge since hitting an all-time high of $2.24 on Aug. 4. The downward movement resulted in a low of $0.65 on May 13. 10. After that, the price of Optimism broke out and accelerated significantly.

    On October 26, the Optimism price hit a high of $1.19. If the uptrend continues, the key long-term resistance zone will be at $1.42.

    OP/USDT daily chart (Source: TradingView)

    Optimism Price Prediction: Where’s next?

    Technical analysis from the daily timeframe is bullish as the daily RSI supports the OP’s current rise.

    First, it can be seen that the indicator created a bullish divergence (green line) before the breakout. Next, the RSI broke out above the descending resistance line (black) and then rose above 50. Both are bullish and acutely relevant signs valid for a breakout.

    As a result, the OP price is expected to continue to end close to $1.42. 

    OP/USDT daily chart (Source: TradingView)

    The number of bullish supporting waves 

    Similar to the RSI, the wave count also supports the Optimism bullish. The most likely number shows that OP price completed an A-B-C correction structure (red), where the A:C wave is 1:0.618. This is the second-highest probability of such corrections.

    After that, a breakout above the wedge confirms that the correction is complete and a new uptrend has begun.

    OP/USDT daily chart (Source: TradingView)

    If a new uptrend starts on October 23, the OP price is now nearing the end of the short-term rally (black). So, it makes sense if the fifth wave ends close to the $1.42 horizontal resistance area.

    After that, a correction period may occur before the uptrend resumes.

    These are only rough outlines of potential OP price predictions as precise values ​​of future highs are required to determine a potential bottom.

    Conversely, a drop below the October 21 low of $0.63 will invalidate this particular wave count. If that happens, a new all-time low is expected.

    OP/USDT 6-hour chart (Source: TradingView)

    *Disclaimer: This article is for informational purposes only, not investment advice. Investors should research carefully before making a decision.

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