Optimism (OP) has weakened from $1.64 to $1.35 since August 24, 2024, and the current price stands at $1.38. A slowdown in net inflows and decreased trading activity are certainly negative factors for OP and in the days ahead we could see even lower prices for this cryptocurrency.
The wider dynamics of the cryptocurrency market also play an important role in determining the price of Optimism (OP) and when Bitcoin, as the leading cryptocurrency, experiences a significant decline, it usually leads to overall negative sentiment across the entire market, affecting altcoins like OP.
On the other side, some crypto analysts said that OP is currently undervalued, pointing to the significance of Coinbase and the brand it has created over the years as a crypto exchange. They believe that the key to Optimism’s success lies in the “power” linked with Coinbase, a brand facilitating billions of dollars in daily trading. So where is the price of Optimism (OP) going next, and what can we expect from September 2024?
Today, Crypto Lists will discuss Optimism (OP) price estimates from a technical and fundamental analysis perspective. Please note that there are also many other factors to consider when entering a position, such as your time horizon, willingness to risk, and how much margin you have if trading with leverage.
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- 1 Optimism (OP) is committed to further growth of its ecosystem
- 2 A risk of further decline still persists
- 3 Technical analysis for Optimism (OP)
- 4 Important support & resistance levels for Optimism (OP)
- 5 What speaks for the rise in the Optimism (OP) price
- 6 What indicates the downfall of Optimism (OP)
- 7 What do analysts and experts say?
Optimism (OP) is committed to further growth of its ecosystem
Optimism is an extension to Ethereum which enables users and developers to benefit from the latter’s strong security guarantees while being cheaper and faster. Optimism’s EVM-equivalent architecture scales your Ethereum apps without surprises and it is important to say that Optimism allows you to do many of the same things as the Ethereum network, but approximately ten times cheaper.
Optimism is driven by real-world needs and it aims to keep its code as simple as possible, using proven Ethereum code and infrastructure when possible. Similar to Ethereum, individuals using Optimism can engage with decentralized finance (DeFi) applications, participate in activities such as buying, selling, collecting, and minting NFTs, and more. OP is the native governance token of Optimism, empowering community members to actively participate in the project’s decision-making processes.
It is important to say that Optimism is home to numerous protocols and it is committed to further growth of its ecosystem. The positive news is that Sony’s blockchain division, Sony Block Solutions Labs, is launching a testnet and developer incubation program for its Optimism-based Soneium blockchain. The Soneium blockchain is an Ethereum Layer 2 based on the Op Stack designed to provide a “cost-effective development environment” for building consumer-grade applications. Sony Block Solutions Labs announced:
“This dual initiative marks a significant milestone in Sony Group Corporation’s entry in Web3, poised to catalyze ecosystem growth and accelerate adoption by leveraging its vast global reach and technological expertise across entertainment, gaming, and consumer electronics sectors. Circle, Optimism, Alchemy, The Graph, Chainlink, and the Astar Network will all be early experimenters of the network.”
A risk of further decline still persists
The beginning of August 2024 has been positive for Optimism (OP), but the price of OP has remained under pressure since August 24, 2024, and the risk of further decline is still not over. There has been a significant decline in whale transactions for OP over the last several days and a decline in large trades might be interpreted as waning confidence among large investors.
This situation could negatively affect the decisions of traders in the days ahead and potentially lead to further declines in OP’s price as other market participants follow suit. At the same time, the price collapse that has continued since March 2024 has led many futures traders, who had bet on a price rally, to witness liquidations. It is important to mention that liquidations occur in an asset’s derivatives market when the asset’s value moves against the position held by a trader. When liquidation happens, the trader’s position is forcefully closed due to insufficient funds to maintain it.
However, some crypto analysts are convinced that OP is currently undervalued and according to them, OP will increase its value because of Coinbase’s strength. Coinbase has enabled users to buy, sell, and trade OP tokens on its platform and has already expressed interest in Layer 2 solutions like Optimism to improve its own platform’s scalability and efficiency.
Technical analysis for Optimism (OP)
Optimism (OP) has weakened from $1.64 to $1.35 since August 24, 2024, and the current price stands at $1.38. Traders should keep in mind that as long the price of OP is below this trendline which I marked on the chart below, the price of OP remains in the SELL-ZONE.
Important support & resistance levels for Optimism (OP)
On this chart (the period from January 2024), I marked important support and resistance levels that can help traders understand where the price could move. Optimism (OP) has been in a negative mood since March 07, 2024, but if the price advances above $2, the next target could be a resistance level at $2.5. The important support level is $1, and if the price breaks this level, it would be a “SELL” signal, and we have the open way to $0.5.
What speaks for the rise in the Optimism (OP) price
Many crypto analysts said that Optimism (OP) could have a bright future and while still in its early stages, its unique blend of security, technology, and innovative features positions it as a strong contender in the race for mass adoption. Investors should consider that the overall sentiment on the cryptocurrency market can play a crucial role in OP’s price trajectory. If investors regain confidence and the market recovers from recent setbacks, an upside potential could benefit OP and other cryptocurrencies. Analysts and traders often closely watch the activity of crypto whales because the behavior of crypto whales can influence market sentiment and an increase in the number of big transactions for OP is something that could drive the price higher.
What indicates the downfall of Optimism (OP)
The downfall of Optimism (OP) can be influenced by a wide range of factors, including negative news around this project, market sentiment, regulatory developments, macroeconomic trends, and more. The period since March 07, 2024, has been negative for OP, and the bearish mood among OP whales seems to be a major factor that influenced the OP price downtrend. The strong support level for OP stands at $1, and if the price falls below this level, the next target could be $0.5. The price of OP is usually correlated with the price of Bitcoin, and if the price of Bitcoin drops below the $55000 price level, that would certainly have a negative influence on the price of OP.
What do analysts and experts say?
After hitting record price levels above $4.8 on March 07, 2024, Optimism (OP) has encountered significant losses. The price currently stands at $1.38, but a break below support that stands at $1 would indicate that OP could price levels around $0.5. Optimism (OP) is unpredictable and a risky investment, and because of this, investors should continue to be very cautious in the case of this cryptocurrency. However, some crypto analysts have the opinion that OP is currently undervalued, and according to them OP will increase its value because of Coinbase’s strength. Coinbase has shown interest in Layer 2 solutions like Optimism to enhance its own platform’s scalability and efficiency. By integrating or supporting Layer 2 solutions, Coinbase can offer its users faster and cheaper transactions.
Disclaimer: Crypto is extremely volatile and not suitable for everyone to invest in. Never speculate with money that you cannot afford to lose. The information on this site is presented for educational purposes only and should not be construed as investment or financial advice.
