Arbitrum: Is whale interest enough for price surge?
- Whale accumulation of $7.22 million in ARB indicated renewed interest and potential market demand.
- Despite challenges faced by the Arbitrum protocol, ARB showed resilience.
When Arbitrum [ARB] initially made its debut, it garnered significant attention. However, as time went on, interest waned, causing a decline in the hype surrounding the token.
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Now, recent developments suggested that whales were beginning to show renewed interest in ARB, which could have significant implications for its future.
Whale accumulation begins
According to data from Lookonchain, Offchain Labs, the team behind ARB, has actively accumulated approximately $7.22 million worth of $ARB ($7.18 million) from Binance [BNB] through various addresses within the past week. Such whale accumulation is a positive indicator of confidence in the token’s value and prospects.
It appears that institutions are accumulating $ARB.
— Lookonchain (@lookonchain) June 18, 2023
This surge in whale interest coincides with a 12.18% price increase for ARB in recent days, bringing its trading price to $1.0053 at press time. However, the token faced resistance at the $1.0154 level, which must be surpassed in order for ARB to regain the previous levels of $1.153.
Breaking through this resistance level could ignite further bullish momentum for the token.
At the time of writing, ARB’s indicators were favoring its upward momentum. The Relative Strength Index (RSI) stood at 59.32, indicating that the buying pressure was still strong. Furthermore, the Chaikin Money Flow (CMF) had grown to 0.12, suggesting increasing capital inflows into ARB.
The growing CMF implied a rising trend of capital entering the market, further boosting the positive sentiment surrounding ARB.
However, ARB experienced a decline in network growth, accompanied by a decrease in trading velocity. This meant reduced trading frequency and diminished interest from new addresses.
Additionally, trader sentiment leaned slightly bearish, with short positions accounting for 50.65% of all trades.
Realistic or not, here’s ARB’s market cap in BTC’s terms
Challenges for the Arbitrum Protocol
While ARB showed signs of resilience, the Arbitrum protocol faced a challenging week. According to data from Token Terminal, overall activity on the protocol declined by 3.1%.
Consequently, the fees generated by Arbitrum also plummeted by 56.1% over the last month. Addressing these challenges and revitalizing the protocol’s performance will be essential to support the long-term growth of ARB.