- It seems to be about to break out of a huge head and shoulder pattern.
- On -holders stayed in profit, while 40.17% were outside the money.
Optimism [OP] Currently, a head and shoulder pattern has formed that potentially signals further disadvantage. Because the price in the vicinity of a crucial level of support is faltering, investors remain careful with the next step.
The big question at the moment has Will retained his downward trend, or will it reverse to beat all the opportunities?
Is on the way to a breakdown?
Analysis of a well-defined head-and-shoulder formation, a pattern that is often associated with bearish homes.
The left shoulder peaked around $ 2.70, the head was around $ 4.50 and the right shoulder was recently completed below $ 2.50.
Source: Ali -Hitlists
On has since fallen below $ 1.10, with the neckline being violated. This breakdown, if confirmed, suggests further disadvantage, and may be able to test lower supports near $ 0.80 or lower.
However, a failed breakdown can cause a short squeeze, forcing bears to cover their positions and possibly push back to a retracement above $ 1.50.
On: Bulls, Bears in tug of war
A glimpse into the break-even price data showed that 54.89% of the OP holders were profit, while 40.17% were outside the money.
This suggested that a considerable part of the investors could still leave with a profit, limiting panic sales.
Source: Intotheblock
The cluster of AT-the-Money positions (4.94%) near $ 1.01, however, indicated that many traders ran the risk of going to losses if his support levels do not have.
Normally, if a large part of the holders remained profit, the narrow pressure can decrease when buyers intervene to gather at lower prices.
However, if Bearish Momentum speeds up and falls below $ 0.90, the market can see an increased capitulation -driven sales, which may reinforce the downward trend.
Are investors still engaged?
Furthermore, the network activity of the last 15 hours is mixed. At the time of the press, the total addresses were at 9.75K, with new addresses at 1.3k, active addresses at 6.96k and zero balance addresses at 1.49k.
Source: Intotheblock
The 7 -day trends indicated that new addresses fell by -16.68%, which indicates a lower acceptance of the users. Active addresses have risen by +7.38%, which shows that existing users remain involved.
Likewise, zero-balance addresses with +10.85%rose, which suggests that liquidations or inactive portfolios.
Although the increase in active addresses suggested the persistent user involvement, the decrease in new addresses and rising zero-balance portfolios reflect a weakening influx of new investors.
This pattern reflects past bearish phases, where lower acceptance percentages correlated with price consolidation or further drops.
Who checks the market?
The long/short ratio graph for revealed a sharp divergence in sentiment between standard and perpetual traders.
The normal long/short ratio fluctuated between 0.85 and 1.15, which indicates indecision, while the eternal contracts rose a long/short ratio above 2.60, which showed a stronger bullish bias.
Source: Coinglass
High long/short escalios in eternal contracts precede liquidations, because traders about leverage become vulnerable to market fluctuations.
The market can see a sharp correction if it goes down, activating long liquidations and pushing prices to lower support levels.
The balance of the delivery
In the past 365 days, the circulating range of OP has increased by +69.27%and reached up to 1.62 billion tokens.
This sharp increase in supply, in combination with a falling price, suggests an increased sales pressure or inflation that exceeds the demand.
Source: Intotheblock
When the offer increases while the price is falling, market absorption is struggling, which leads to extensive downward trends. If the demand does not catch up, further price corrections can be confronted.
However, if the accumulation is resumed, this can stabilize the market, which can prevent further drops below $ 1.00.
Credit : ambcrypto.com
