Optimism Rallies 20% Since June 6, Breaks Daily Structure

Optimism [OP] has recently exhibited heightened speculative activity, with a notable rally of 20% since testing the $0.59 support level on June 6. This bullish momentum has led to a break in the daily structure, encouraging a positive bias among traders. However, the rally's sustainability beyond $0.74 remains uncertain, as liquidity at this level could play a crucial role in the coming hours.

Swing traders are presented with a buying opportunity if the mid-range resistance is flipped to support. Meanwhile, risk-averse traders may prefer to wait for further clarity before making a move. Going short might not be feasible due to the prevailing bullish structure.

The 1-day chart indicates a range formation between $0.59 and $0.84. The bullish structure break on the daily chart has fueled optimism among traders. A move beyond the mid-range resistance could target the range high at $0.84. However, the current bullish momentum appears underwhelming.

The Money Flow Index (MFI) shows a reading of 44, with no divergences yet. The On-Balance Volume (OBV) has struggled to trend higher, moving sideways since mid-May. This equilibrium in buying and selling pressure explains the range formation and suggests that traders should not expect a breakout beyond $0.84.

The 1-month liquidation heatmap reveals that the buildup of liquidity around $0.72 has been swept, with short liquidations accruing just above this mark. This could pave the way for a short-term move to $0.74 before a potential bearish reversal. However, if Bitcoin rallies past $110k and continues higher, OP might race toward the $0.85 magnetic zone.

Data from Coinalyze indicates that the rally to $0.72 was accompanied by a $22 million increase in Open Interest. The funding rate, which had been negative in June, began to shift in the past 48 hours. Although the funding rate does not show overwhelming bullish sentiment, the increasing Open Interest promises heavy speculative activity. This short-term bullishness could help propel Optimism beyond the local resistance.

According to the analyst's forecast, the movement of Bitcoin over the rest of the week could guide OP’s price action. The rally to $0.72 was accompanied by a $22 million increase in Open Interest. The funding rate, which had been negative in June, began to shift in the past 48 hours. Although the funding rate does not show overwhelming bullish sentiment, the increasing Open Interest promises heavy speculative activity. This short-term bullishness could help propel Optimism beyond the local resistance.