Cryptocurrency analyst Ali has expressed optimism about Ethereum’s second-layer scaling solution Optimism (OP), believing the token is set for a bullish trend.

Ali noted that OP is forming a chart pattern related to a bounce pattern, which has been seen several times in past cycles. He focuses specifically on OP forming ascending triangles at market bottoms, a pattern that, when confirmed, often results in significant price increases.

According to Ali’s analysis, OP is currently constructing another ascending triangle pattern, and a breakout may lead to a trend reversal and a strong rebound. He expects OP to reach $7.20, a price range that is the 1.618 Fibonacci retracement level and a common technical breakout point. If OP reaches this target, the increase may reach 340%, attracting the attention of a large number of investors and traders.

However, despite bullish long-term forecasts, OP has recently seen a drop of over 10%, with the price plummeting from recent highs to around $1.59. This has led to a dampening of market sentiment and a decline in both market capitalization and trading volume, with the current market capitalization at approximately $2 billion and 24-hour trading volume at approximately $670 million.

The sell-off could be part of a broader market correction, but Ali believes the downturn could instead mean OP is close to a bottom rather than a negative sign. He noted that ascending triangle patterns typically undergo retracements and bounce close to support multiple times before breaking out, so the current price action could be a buying opportunity.

From a technical perspective, OP follows a Fibonacci retracement pattern and has historically broken out of such setups many times, with price rebounding strongly after reaching the 1.618 Fibonacci extension. Ali's chart further validates this trend, showing that OP hit and broke key Fibonacci resistance multiple times after breaking out of the ascending triangle.

Historical data suggests that OP may face some resistance after it reaches the 1.618 Fibonacci extension, which is also a key area for traders and investors to set profit targets. Currently, although the price has fallen below the ascending channel, if the OP can break out and build momentum, the ADX indicator will show an increase in trend strength, further confirming the validity of the ascending triangle and signaling increased upward momentum.