Author: 3HOUSE user @RickTrader

One of the most important aspects of investing in any cryptocurrency is conducting a fundamental analysis to understand the underlying factors that could impact its price over time. In this case, I will conduct a fundamental analysis of the OP cryptocurrency.

OP is a relatively new cryptocurrency that was launched in 2021. It is a decentralized platform that allows users to create, manage and trade various types of digital assets. The platform is built on the Ethereum blockchain, which means that it is highly secure and reliable.

One of the key features of OP is its governance model. The platform uses a unique consensus mechanism called Proof of Participation (PoP), which allows token holders to participate in the decision-making process for the platform. This means that the platform is fully decentralized and democratic, with no central authority or controlling entity.

Another important aspect of OP is its scalability. The platform is designed to be highly scalable, which means that it can handle large volumes of transactions and users without any issues. This is a critical factor in the success of any cryptocurrency, as scalability is necessary for mass adoption and widespread use.

When it comes to the market potential for OP, there are several factors to consider. Firstly, the cryptocurrency market as a whole is growing rapidly, with more and more investors and traders entering the space every day. This means that there is a significant demand for new and innovative cryptocurrencies, which OP could potentially capitalize on.

Additionally, the platform's unique governance model could be a significant selling point for potential investors. As mentioned earlier, the PoP consensus mechanism allows token holders to participate in the decision-making process for the platform. This means that users have a say in the direction of the platform, which could help to build trust and loyalty among the user base.

Another factor to consider is the team behind OP. The development team is experienced and has a track record of success in the cryptocurrency space. This gives investors confidence that the platform will be developed and maintained to a high standard.

Currently, in the entire crypto market, there is a lot of greed at the moment, we can see that on the Fear & Greed Indicator.

We all know that BTC and ETH are the leading cryptocurrencies and when analyzing various coins we need to acknowledge what these two are doing. The last time that BTC was on 60-70 greed levels was in march 2022 so when BTC spiked to $47000.

Adding to that we can see on the weekly chart (1W) huge bearish SMT divergences comparing it to ETH and currently BTC running into major resistance levels that in my opinion won’t be broken on the 1st attempt.

The rise was very quick, that’s why price have left a huge fair value gap that would need to be rebalanced.

If in the next week or two, BTC or ETH probably won’t be able to push higher. I think that we will see drops in price for all cryptocurrencies and that’s why $OP might be a perfect coin to accumulate.

OP is currently trading at $2.26 per coin. It’s a very good result for a project that is only 2 years old, that’s why I want to show you my accumulation plan.

When it comes to accumulation patterns price needs to go very deep for them to work but long term they work very often.

Looking at $OP on the weekly chart we can clearly see two buy-side imbalance sell-side inefficiencies marked with the red color on the chart (1st from $1.55 to $1.30 and 2nd from $1.20 to $0.95). Once reached and filled they can give a strong reaction and there are plenty more levels of support in this region.

On top of the 2nd imbalance, we have a bullish breaker block that was created after the strong initial push that also gives another bullish confluence starting around $1.10 and ending at the $0.85 level.

Switching to the daily chart, we will use the Fixed Range Volume Profile to see how the trading volume is distributed. This will help us to define support levels and show where traders/spot buyers are the most active. As shown on the chart the most volume is between $1.20 and $0.85, so another bullish confluence to add.

Also, another important tool is pivot points and in this case, we will use the strongest yearly fibonacci pivot. Traders use pivot points to identify potential levels of support and resistance, as well as to gauge the overall trend of the market. Pivot points can be used in combination with other technical analysis tools, such as moving averages and oscillators, to make trading decisions.

The current year pivot sits at around $1.20, meaning that this region is an important and significant levels for spot holders as well as traders.

After combining everything and looking at what is presented in the chart we can say that the Golden accumulation Zone is between $1.20 to $0.90. Potential spot entries can be broken down into 3 partials: 1st $1.20, 2nd $1.05 and 3rd $0.90, but the best option would be to wait for price to stabilize inside the Golden Zone and make entries after a bullish market structure change. Stop Loss could be placed at $0.58.

Accumulation takes time as it’s a long process but by combining the fundamentals with technicals this project has a bright future and once our Golden Zone will be reached we can look at the targets:

• First target: $2.10 - A 75% increase in price from the Golden Zone. This level has shown its power as an S/R Flip Level and it will be also a Key Level in the future. Risk to reward ratio is 2,25.

• Second Target: $3.00 - A 150% increase in price from the Golden Zone. Breaking this level will mark an upcoming strong bullish trend. Risk to reward ratio is 4.15.

• Third target $3.30 and beyond - A 173% increase in price from the Golden Zone. After reaching two previous targets I am convinced that a new All-Time High will be just a matter of time at this point. Risk to reward ratio is 4.75.

“All risk R:R measured with an average entry of $1.05, SL at $0.58”

In conclusion, Optimism can provide us with an incredible opportunity once markets decide to retest lower levels. With the evolution of the crypto space Optimism as a Layer 2 scaling solution for the Ethereum network that aims to address the network's high transaction fees and slow confirmation times can play a vital part in the growth of the Web3 environment.

I encourage spot buyers, investors and traders to keep a close eye on Optimism during upcoming weeks. However, as with any investment, it's essential to conduct thorough research and consider the risks involved before making any decisions.

This is not Financial advice, trade at your own risk!

NFA is a showcase of the high-quality alpha shared on 3HOUSE and an opportunity for the development team to recognize and celebrate the well-researched and expertly-constructed predictions made by some of our 3HOUSE community members.

Important note: Despite yielding positive returns for many investors, as the name states, NFA is Not Financial Advice and does not guarantee any results. NFA is merely to inform investors of potential market movements and general sentiment. Always do your own research.