Optimism price prediction: OP forms a double-top pattern

on Feb 27, 2023
  • Optimism price has been in a strong bullish trend in the past few days.
  • It has formed a double-top pattern on the four-hour chart.
  • The coin will likely retreat in the coming days.

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Optimism (OP/USD) price has made a strong comeback as demand for layer 2 scaling solutions rose. The token jumped to an all-time high of $3.27 after the developers welcomed Coinbase to its ecosystem. It has jumped by more than 631% from its lowest point in 2022.

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Optimism partners with Coinbase

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Optimism is one of the most popular Ethereum scaling networks in the blockchain industry. It simply makes it possible for developers to build quality dApps that are significantly cheaper to operate and fast. In its existence, Optimism has saved its users over $2.7 billion in gas fees.

Optimism is facing growing competition in its industry. The biggest competitor is Polygon, which is the biggest layer 2 network in the industry. Its other key competitor is Arbitrum, which has seen the total value locked (TVL) in its ecosystem jump in the past few months. Other layer 2 networks are Immutable X and Loopring.

The most recent Optimism news was the partnership with Coinbase, the second-biggest crypto exchange in the world. Coinbase will become a core developer of the OP Stack codebase. It will also use Optimism’s technology to build Base, which will commit part of its income to the Optimism Collective treasury. 

This partnership is in line with Optimism’s goal of building a Superchain. It defines a superchain as complex platform that solves key challenges for companies. For Coinbase, it could decide to move to Ethereum and deal with its scalability challenges. 

Alternatively, it could move to a single layer 2 network and be fully dependent on their technology. In this case, Coinbase has decided to build its own chain, where it has control.

Optimism is widely used by developers. According to DeFi Llama, the network has been used to build hundreds of DeFi apps that have a total value locked (TVL) of over $947 million.

Optimism price prediction

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Optimism price

OP chart by TradingView

OP price has been in a strong bullish trend in the past few months, which has seen it reach its all-time high. The coin has formed a double-top pattern at $3.27 whose neckline is at $2.08. In price action analysis, this pattern is usually a bearish sign. OP remains above the 25-day and 50-day moving averages.

Therefore, with the enthusiasm of Coinbase’s partnership easing, and because of the double-top pattern, there is a likelihood that the coin will retreat in the coming days. If this happens, it will likely retest the support at $2.30.