Newton Gitonga
Optimism (OP) displays significant bearishness after losing 25% and nearly 50% in the past week and month.
Furthermore, the charts show OP has formed a head-and-shoulder formation, hinting at impending downward continuation.
OP forms a head-and-shoulders pattern
Optimism’s price performance demonstrates bear dominance, and the emerging head-and-shoulders formation affirms this narrative.
The head forms a visible peak as the shoulders appear symmetrical.
OP trades at the crucial support barrier of $1.12.
Breaching this foothold could catalyze significant dips for the altcoin.
Optimism will likely test the $1.06 mark or even lower price regions.
The distance from the head’s peak to the neckline sets OP’s bearish target at $0.5.
That would mean an approximately 55% slump from the current price.
Technical and on-chain signals indicate weakness
Further analysis adds to Optimism’s bearish trajectory.
The Chaikin Money Flow hovers at the negative territory (-0.08) after plunging from +0.36 in the past 72 hours.
That confirms reduced cash entering the OP ecosystem, reflecting investor distrust in the altcoin’s near-term performance.
The 1D Moving Average Convergence Divergence’s bearish crossover with the signal line confirms the notable selling pressure.
IntoTheBlock’s data magnifies OP’s bearish picture, with all on-chain signals highlighting a downbeat mode.
Firstly, over 91% of OP investors are experiencing losses at current prices of $1.12.
This might intensify selling activities amid continued price dips.
Altcoin will hardly attract new buyers, considering its dwindled profitability.
The 0.87% decline in net network growth highlights reduced network activity and faded interest from new users.
Concentration declined by 0.80%, confirming weakness and notable challenges in flipping the pessimistic on-chain data.
Further, the 2.49% slide in large transactions indicates reduced interactions by whale entities.
OP’s current price action
Optimism trades at $1.12 after gaining 1.54% in the past 24 hours.
Despite the minor surges, the notable decline in daily trading volume suggests a weak uptrend.
Bulls should hold the reliable support floor at $1.12 to prevent further price dips.
However, all technical, sentiment, and on-chain signals highlight significant downward risks for OP.
The head-and-shoulders formation, reduced cash flows, faded profitability, and bearish on-chain signals point to potential price slumps in the near term.
Nevertheless, broad market movements remain crucial for Optimism’s trajectory in the upcoming sessions.
Cryptocurrencies displayed volatility today amid tariff-triggered economic uncertainties.
Meanwhile, experts remain confident about the market, perceiving the ongoing declines as dip-buying opportunities.
According to Eric Trump, Bitcoin presents a perfect entry-level at current prices.
Sudden bullish rallies in the broad market will mean substantial gains in the overall crypto landscape.
That could see Optimism invalidating the head-and-shoulders bearish setup before exploding to the upside.
Analyst Solberg Invest highlighted a potential surge to $7 for Optimism.
🚀 $OP (Optimism) macro-bullish—Target $7 next? 📈
That would mean an over 480% upswing from current levels.
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