Arbitrum attempts recovery, will short-sellers run out of opportunities
Disclaimer: The information presented does not constitute financial, investment, trading, or other types of advice and is solely the writer’s opinion
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- ARB formed an ascending channel pattern on a 3-hour chart.
- Hourly active addresses surged alongside 7-day MVRV.
Arbitrum [ARB] has enjoyed massive traction after several exchanges like Binance listed it. At press time, it was the top trending token on CoinMarketCap, trading at $1.393.
The Arbitrum ecosystem’s native token has been trading in the red but saw a significant recovery after hitting $1.1 around 28 and 29 March.
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At press time, Arbitrum blockchain was ranked fourth based on TVL (total value locked) of $2.46B, according to the CoinMarketCap chain ranking.
Its native token’s price action oscillated within an ascending channel as bulls strived to sustain the recovery. But is the recovery sustainable?
Is bulls’ target of $1.5 attainable?
At press time, the price action on the 3-hour chart was firmly below the channel’s lower range, oscillating between the lower boundary and the channel’s mid-level. As such, ARB could rebound after hitting the channel’s boundary at $1.367 and aim for the mid-level of $1.439.
A close above the mid-level could push ARB to the channel’s upper boundary, but bulls must clear the $1.49 hurdle. Such an upswing could push ARB to the $1.5 zone in the short term.
A breach below the channel would invalidate the above bullish thesis. A pullback retest to the breached lower boundary of $1.367 and a confirmed downtrend could attract more sell pressure. Such a move could sink ARB towards key supports at $1.32, $1.30, and $1.2.
The RSI (Relative Strength Index) value at press time was 65 – a bullish signal. However, it has exhibited a downtick near the overbought zone, highlighting a potential price reversal.
Similarly, the OBV (On Balance Volume) rose but pivoted at press time, indicating demand eased. The Chaikin Money Flow (CMF) also moved southwards – an indication of growing sellers’ influence in the market at press time.
Hourly active addresses and 7-day MVRV surged
According to Santiment, hourly active addresses increased at press time, which could boost trading volume and likely rebound from the channel’s lower boundary. Besides, considerable whale activity above $1M was recorded in the past few hours, further boosting the recovery.
How much is 1,10,100 ARBs worth today?
The recovery has helped weekly holders see improved gains by over 10% – evidenced by 7-day MVRV increasing to 11% at press time. Investors should track BTC’s price action to make more informed decisions.