Optimism (OP) is currently in a position to potentially start a recovery after following the downtrend of the broader market. The altcoin is receiving support from its investors, which could lead to OP reclaiming $2 as a support level. This positive reception is evident in the Market Value to Realized Value (MVRV) ratio, where the 30-day MVRV of 10% indicates potential losses, prompting buying. Historically, an OP MVRV between -10% and -20% has signaled recoveries and rallies, making it an opportunity zone for accumulation.
Moreover, investors are holding onto their OP holdings, with less than 5% of participating investors currently in profit. Crossing the 25% mark of OP holders in profit is seen as a bearish sign, indicating profit-taking, while lower participation is considered bullish as it shows investor HODLing behavior. This strong investor support could help OP in its path to recovery.
Optimism’s current price of $1.7 is bouncing back from support at $1.6, with the target of reclaiming $2.0 as a support floor. To achieve this, breaching $1.8 is necessary. The rise in price is supported by investors’ bullish sentiment, but the outlook for recovery remains uncertain until $2.0 is solidified as a support level. If this level is not reached, OP’s price may consolidate under $1.8 or remain below $2.0, potentially invalidating the bullish thesis and extending the losses.
In conclusion, Optimism’s potential for recovery is dependent on investor support and the ability to reclaim $2.0 as a support level. The MVRV ratio and active addresses by profitability indicate positive signs for OP, but the altcoin must breach $1.8 to secure its path to recovery. Failure to do so could result in continued consolidation or decline in price. Investors are eagerly watching for OP to reclaim $2.0, which could potentially trigger a rise in the altcoin’s price and lead to further gains.
