Daily News | Crypto Market is on the Rise, Meme is Strong; Trump Stated that "the US Should Become the Leader in Cryptos"; Ether.fi's Deposits and TVL Skyrocketed to Historic Highs

[TL; DR]

On 21 Ma the Arbitrum token rallied above the $1.17 ke resistance level.

The ARBs red future Ichimoku cloud indicates a strong bearish momentum.

ARBs 30-da MVRV ratio shows that most Arbitrum token holders ma gain if the sell the token when its price is above $1.17.

Introduction

After the Ethereum Shanghai upgrade Arbitrum emerged as one of the leading laer-2 blockchain based tokens, outperforming its Ethereum L2 rival, Optimism. For example, during the first quarter of 2023 Arbitrum generated $4 million more than Optimism (OP).

For the greater part of 2023 the Arbitrum token maintained a higher total value locked than Optimism. For example, as of 13 April Arbitrums total value locked (TVL) was $2.27 billion while Optimism had a TVL of $930 million. The focus of this analsis is to look at Arbitrums recent price surge. We will also assess if Arbitrums bullish momentum ma last a long period.

Recent news: Going beond the EVM with Arbitrum Stlus

Arbitrum's (ARB) Recent Surge past the Critical $1.17 Resistance Level

On 21 Ma the Arbitrum price surged past $1.17, giving room for most investors to take profit depending on when the acquired their ARB tokens. B the 23rd of Ma the Arbitrum (ARB) price had reached $1.23.

Based on the current and past crptocurrenc market trends it ma not be sustainable for ARB to maintain a price which is above $1.17. The ke reason is that an value above that figure falls within a profit-taking one, thereb attracting a mass sell-off. Alread, there is a bearish indication from the token holders as the current market sentiment shows the ARB holders willingness to sell the crptocurrenc.

The Market Value to Realied Value (MVRV) ratio also indicates that the market is in an overbought one. Basicall, the Arbitrum MVRV ratio shows whether or not the asset is in a profitable or loss state at a particular time.

As of the beginning of the fourth week of Ma the Arbitrum MVRV ratio was 20%, signalling that it was in a profitable state. In such a situation the ARB holders would make a profit if the sell their holdings. In previous scenarios ARB corrections used to occur when the MVRV was between 7% and 24%. The following graph indicates the ARB MVRV situation during the cited period.

Read also: Overview of Arbitrum Laer3 Landscape Arbitrum MVRV Ratio Santiment

Related to the above situation, when the price of ARB surged b 20% during the third week of Ma man investors started selling their holdings due to the token's profitable state. In other words, realied losses turned into realied profit. The next graph shows how ARB switched from the realied losses to realied gains. Arbitrum Network Realied Profits: Santiment

Arbitrum Bullish State: The Reasons behind ARB Price Surge

As said above, during the third week of Ma Arbitrum gained much pushing its price above $1.21. There were a number of reasons for the ARB price break above the $1.17 critical resistance level.

One of the ke causes of the Arbitrum price rall was a rise in the number of new wallet addresses, indicating an increase in network activit. Arbitrum, the laer2 solution for Ethereum, recorded an all-time-high in terms of new wallet addresses on 16 Ma. It had a record of over 900,000 new wallets, showing a rise in its user engagement. The reason for the influx of new users is an increase in demand for its DeFi platform and NFT features.

Another catalst for the recent Arbitrum momentum and growth was the increase in its network performance. At one time the network processed over 1 billion transactions across Nova and One, positioning itself as one of the best crpto ecosstems. At the moment there are over 600 teams that are developing more than 50 Orbit chains and 2 DAO-governed chains.

Another driver of the recent ARB price spike was the news of Arbitrum DAOs approval of the plan to pursue mergers and acquisitions (M&A). Currentl there is a team that is assessing the possibilit of the M&A.

Posting on its blog, the Arbitrum Foundation said, One of the primar was for Arbitrum to scalabl deplo capital and grow rapidl is to explore M&A transactions, and the upside is potentiall massive. Additionall, this is a largel untapped opportunit in crpto, onl explored selectivel b a few projects in the space; therefore, setting up M&A would enable Arbitrum DAO to set a precedent in the space.

It added, The ke objective of having an M&A Unit for Arbitrum is to act as a ke growth driver for the Arbitrum ecosstem, help the DAO expand non-organicall through acquisition opportunities, and cement its position as the leading L2 b productivel utiliing its treasur.

Read also: Who Will Win Between ARB and OP?

This initiative, though being a heav lift, would set a precedent for the entire crpto space and offers significant upside potential to the Arbitrum ecosstem if executed properl. Such great news was good enough to generate a bullish momentum that ma continue for more das or weeks.

Technical Analsis: Bearish Shadows Loom

During the third week of Ma Arbitrum had a bearish indication. Whereas, it had a Greed and Fear reading of 73 it had a volatilit of 6.5%. Also, the fact that the Arbitrum price fell from a recent peak of $1.23 to $1.17 showed its bearish nature.

A rise in the bearish pressure would easil push its price below $1.16 or even test lower support levels. To maintain the upward momentum the bulls should not allow the price to fall below $1.17. Instead, the should bu ARB in large quantities to force its price to break above the $1.23 level.

Another sign that the bearish momentum ma continue is the red future Ichimoku. Generall, if the Ichimoku cloud, also known as Kumo, is red on a higher time frame it indicates a strong bearish momentum which ma last for a long period. Despite its present bearish indication, the CoinCodex ARB price prediction signals that its value ma rise b 229.24% to reach $3.72 b 1 Jul.

It is also important to note that a sustained bearish pressure ma force ARB to break below $1.101631, $1.081822 and $1.051529 ke support levels. On the other hand, if investors bu Arbitrum in large amounts it ma break above the $1.151732 , $1.182024 and $1.201833 ke resistance levels.

A Bearish Descent or a Bullish Recover? Possible scenarios for ARB's price movement

First, some traders believe that ARB is undervalued resulting in a high potential to rise in the near future. As of 29 Ma the Bollinger Bands was at a stable point, signalling that the ARB price might move sidewas as the picture below indicates. Arbitrum Price Movement - CoinEdition

At that point a bearish push might lead its price to fall below $1.17. On the other hand, a rise in its bullish momentum ma push its value above $1.25.

Conclusion

The ARB price ma not sta above $1.17 ke resistance level as a result of the high selling pressure on the market. Once the price of the Arbitrum token is above that level it is in the profit taking one which lures man investors to sell their holdings. Also, the MVRV ratio indicates that most ARB holders can earn profit if the sell the token. The future Ichimoku is also red indicating a bearish momentum.

FAQs about Arbitrum (ARB)

Does Arbitrum have a future?

Based on its functionalit Arbitrum has a good future since it is an Ethereum laer-2 blockchain. Most laer2 blockchain based tokens are in high demand as the have much utilit in the Ethereum ecosstem.

What is the all-time high price of Arbitrum?

The ARB token attained an all-time high price of $2.39 on 12 Januar 2024. Its price is currentl 53% lower than that of ATH. On the other hand, it has an all-time low of $0.7449, it reached on 11 September 2023.

Is ARB coin good investment?

The ARB coin is a good investment since it is a laer-2 blockchain based token which normall rallies strongl during bull markets. However, the future of such coins can be affected b emerging crpto regulations.