Optimism: Is a breakout likely?

Disclaimer: The information presented does not constitute financial, investment, trading, or other types of advice and is solely the writer’s opinion.

• Since 24 October, OP has fluctuated between $1.35 and $1.45.
• Liquidation data showed that the price range could extend, but moderate liquidity was on the upside. 

Optimism [OP] has been stuck in a short-term price consolidation for the past few days. The neutral position wasn’t unique only to OP. The overall market consolidated ahead of the Fed rate decision on 1 November. 

Read Optimism [OP] Price Prediction 2023-24 

On 27 October, AMBCrypto was bullish on the token after it hit an overhead roadblock at $1.45. The report counted on a bullish reversal in liquidity on chart/support at $1.35. The projection was validated. 

But the price hit the overhead hurdle again at press time. Will last week’s trend repeat? 

Can late bulls exploit the range-low?

Source: OP/USDT on TradingView

The liquidity on the 12-hour chart of $1.33 – $1.35 (orange) has been used by bulls for market re-entry for long positions. 

Notably, the breaker block on the daily chart of $1.40 – $1.46 (red) has been a sticky roadblock. As such, near-term bulls used it as a key take-profit level. So, the range formation and trend could extend if BTC doesn’t cross $35.2k ahead of the Fed rate decision on 1 November. 

However, OP must deal with other obstacles at $1.50 and $1.59 in case of a bullish breakout from the short-range formation. 

On the south, the support of $1.26 – $1.28 (cyan) could ease the extra drop if sellers managed to inflict a bearish breakout.

Meanwhile, the Spot market demand for OP and capital inflows were above average, as shown by positive OBV and CMF.  However, the RSI fluctuated in the upper zone and denoted wavering demand, which captured the recent range formation. 

Liquidation data suggests…

Source: Hyblock

Liquidation data from Hyblock showed almost equally distributed liquidation levels on either side of price action as of press time. 

How much are 1,10,100 OPs worth today?

However, the upper side had significantly larger open liquidity at $1.40 and $1.43, with $1.67 million short liquidations on each level. So, these two higher liquidity levels could be hit before the price moves lower to collect the low liquidity around $1.35. 

But the Fed rate decision could tip a bullish breakout if rates remain unchanged and BTC rallies. So, tracking the Fed announcement and BTC price action is crucial.