Arbitrum fronted a recovery- Can ARB bulls overcome the $1.4200 hurdle
Disclaimer: The information presented does not constitute financial, investment, trading, or other types of advice and is solely the writer’s opinion
- Price action edged closer to a key confluence of resistance.
- More short positions liquidated, and CVD grew, reinforcing buyers’ leverage.
Arbitrum [ARB] fought fiercely to secure the $1.300 support. Since 23 April, sellers threatened to crack the support, but bulls remained steadfast.
After securing the support, ARB attempted recovery at press time but may hit a snag if the overhead resistance zone near $1.4200 is formidable.
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Meanwhile, Bitcoin [BTC] reclaimed the $28k zone and could nudge near-term bulls to attempt to clear the obstacle and aim at higher resistance targets.
However, should bears overwhelm bulls at the resistance area, buyers may seek re-entry at lower support levels.
Can bulls bypass the hurdle?
The RSI (Relative Strength Index) was slightly above the 50-mark – showing an almost neutral position with a slight edge toward bulls.
In addition, the OBV (On Balance Volume) increased slightly, indicating improved buying pressure that may drive the recovery. However, price action faced a key confluence area of resistance near $1.4200.
The dynamic 50-EMA (orange line) has been a key resistance level in the past six days. The moving average also aligns with 100-MA, an immediate resistance level, and a bearish order block at $1.4200.
If more sellers enter the market at the above confluence area, the ARB could drop to the previous support zone of $1.300 before attempting another rebound.
But a breach below the support could be checked by the next support level at $1.1437 ( a key swing low in the first half of April). Buyers could seek re-entry at these levels in such a scenario.
However, a clearance of the confluence area will indicate near-term bulls gained more market influence. Such an upswing could set ARB to rally to $1.49 or $1.57, especially if BTC reclaims the $29k price range.
More short-positions wrecked
How much is 1,10,100 ARBs worth today?
According to Coinglass, over $200k worth of short-positions were wrecked within the 4-hour timeframe compared to only $63k worth of long-positions.
On the 24-hour timeframe, $2 million worth of short positions were liquidated compared to $291k of long positions. It reinforces a short and long-term bullish momentum which could propel bulls to clear the $1.4200 resistance area.
In addition, CVD (cumulative volume delta) indicator grew, indicating buyers were dominant by press time. As such, there is a high chance of bulls overcoming the $1.4200 obstacle unless BTC fails to reclaim the $29k zone.