Arbitrum might rally by another 6% if these conditions are met
Disclaimer: The information presented does not constitute financial, investment, trading, or other types of advice and is solely the writer’s opinion.
- A bullish defense of $0.87 could set buyers for a rally.
- Funding rates and long-term price trends were positive.
Arbitrum’s [ARB] bullish reversal at $0.87 could expose buyers to a likely 6% gain. The altcoin retraced to a key resistance-cum-support of $0.87. The pullback occurred after a price rejection at a resistance of $0.93, devaluing the Layer-2 token by 8% at press time.
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But ARB’s retracement hit an ideal entry point for a long position if BTC doesn’t post more short-term losses.
Is a rebound likely at $0.87?
The daily bearish order block (OB) below $1 prevented the altcoin from surpassing a dollar value since late August. A price rejection at the roadblock forced ARB to retrace to $0.87.
Interestingly, the $0.87 level aligned with liquidity on charts of $0.86 – $0.88 (white) and an H12 bullish OB of $0.8275 – $0.8675 (cyan). A rebound at the above confluence area could set ARB to retest the overhead hurdle and local supply area at $0.95 (red).
If so, such a move could set ARB to rally 6%- A modest gain if traders scoop it up at the $0.87 level.
However, a drop below the H12 bullish OB ($0.8275 – $0.8675) will invalidate the above bullish bias, especially if BTC extends its retracement below $34k.
Meanwhile, the RSI and CMF had downticks, denoting buying pressure, and capital inflows eased. However, the indicators were still above critical thresholds, underscoring buyers’ market edge at press time.
Funding rates were positive
The positive funding rates further confirmed the buyers’ leverage at press time. The reading showed a positive market sentiment and bullish bias against the altcoin. In addition, the long-term price trend was positive and indicated ARB was in an uptrend at press time.
How much are 1,10,100 ARBs worth today?
However, the Open Interest (OI) rates eased slightly, as shown by the lower highs in the past few hours. It meant that demand for ARB in the derivatives market eased slightly over the same period.
So, traders should track BTC’s price action for risk mitigation and optimized set-ups.