The crypto market, led by Bitcoin, continues its upward momentum at full speed, and during this period, many investors have managed to achieve significant gains. In the coming days, the Dench update set to take place in the Ethereum ecosystem will initiate an important process for Layer-2 networks. So, what are the expectations for OP and TAO during this period? Let’s examine together.
Optimism Chart Analysis
Optimism has been on an uptrend for the past few days. The breakout above the $4.20 resistance completed an inverse head and shoulders pattern on March 5th. The upward sloping 20-day EMA level of $4.12 and the RSI in the positive zone indicate that the path of least resistance is upwards. If buyers can push the price above $4.87, the OP/USDT pair could rise towards the $5.79 formation target.
Contrary to this assumption, if the price sharply drops from the current level and falls below the 20-day EMA average, it would indicate that the breakout could be a bear trap. The pair could then drop to $3.42. A break below this level would turn the advantage in favor of the bears.
The pair has held the price above the $4.20 breakout level, indicating a positive trend where every slight dip is being bought. Buyers are trying to overcome the $4.87 resistance and establish their dominance. If successful, the pair could climb to $5, where bears may mount a strong defense. The first sign of weakness would be a break and close below the 50-day SMA average, which would increase the likelihood of retesting $4.20. Bears would need to push the price below this support to indicate the start of a corrective phase.
Bittensor Chart Analysis
Bittensor (TAO) has pulled back to the important short-term level of the 20-day EMA average, which is $646. If the price rebounds from the 20-day EMA average, it will indicate that the bulls remain in control, increasing the likelihood of a breakout above $757. The TAO/USDT pair could then continue its upward trend towards $846.
Alternatively, if the price falls below the 20-day EMA average, it would indicate that the bulls are hastily booking profits. The pair could then drop to the 50-day SMA average of $535. Bears would need to pull the price below the 50-day SMA average to signal a potential trend change.
The 4-hour chart shows that the bulls are struggling to keep the price above the $700 level, indicating that bears remain sellers on rallies. If the price stays below the 50-day SMA average, the next stop could be $617. If this level also fails to hold, the pair could fall to $550.
On the contrary, if the price recovers from the current level, it would indicate that the bulls are trying to turn the $700 level into support. If they succeed, the pair could retest the $757 level, which is likely to be breached. The pair could then surge towards $850.
