Disclaimer: The information presented does not constitute financial advice, investment advice, trading advice or any other form of advice and is solely the opinion of the writer
- OP’s pullback held steady at around $1.18.
- Despite the positive financing rates, sellers had the upper hand.
Optimism [OP] had struggled to get above $1.45 since September. In October, the price fell even further as sellers exploited bearish pressure, but remained stable at around $1.18 at the time of writing.
Read Optimism [OP] Price forecast 2023-24
In the meantime, Bitcoin [BTC] saw a surprising rebound from Sunday (October 16), recovering most of its recent losses. OP took BTC’s signal and registered a jump, but faced a roadblock above $1.25.
Will sellers exploit the overhead hurdle?
Source: DOT/USDT on TradingView
At the time of writing, OP’s preference for the higher time frame market structure was bearish. The price action was below the recent low of $1.21. Interestingly, the lower high coincided with a bearish order block OB in H12 of $1.26 – $1.285 (white).
The other two critical hurdles above immediate resistance are $1,349 and a daily breaker block of $1.40 – $1.46 (red).
The bearish market structure could see sellers exploit the immediate hurdle of $1.26 – $1.285 (white). If so, OP sellers can benefit from a 5% shorting profit if the price tests $1.18 again.
A move past the overhead hurdle will counter the aforementioned bullish bias.
Meanwhile, there has been mild buying pressure, as evidenced by the rebound in the Relative Strength Index (RSI) at the time of writing. But capital inflows into the Layer-2 native token declined in October, as evidenced by the southward movement of the Chaikin Money Flow (CMF).
Optimism sellers maintained control of the market
Source: Coinalyse
How many Worth 1,10,100 VPs today?
Since October 8, demand for OP in the Futures market has declined, underscoring the negative sentiment as evidenced by the decline in Open Interest (OI) rates.
Weakening demand in the Futures market allowed sellers to gain more market leverage over the same period, as illustrated by the declining Cumulative Volume Delta (CVD).
However, financing rates have been positive in recent hours, indicating that market sentiment was improving at the time of writing. The bearish bias will be negated if the price action breaks above $1,288 and the market structure changes from the higher time frame to bullish.
