Arbitrum (ARB): Is A Major Price Rally Coming Now?
05 Mai 2023 - 1:20PM
NEWSBTC
Ethereum’s layer-2 blockchain Arbitrum is facing a pivotal moment:
will it break out of the descending triangle (in the 4-hour chart)
or will it see an even deeper correction in the coming days. As
NewsBTC reported, Arbitrum’s on-chain data remains extremely strong
and could signal an end to the downtrend. However, an important
question will also be whether investors regain confidence in
altcoins (except PEPE). Bitcoin dominance has been on the rise
again against altcoins since May 1, approaching the local high of
49%. Once confidence returns, ARB could benefit greatly. But if
not, another plunge could be next. Arbitrum Price Analysis
Arbitrum’s price corrected sharply in the last two trading weeks
after reaching an all-time high of $1.81 on April 23. It was only
in the area of the old breakout zone at $1.30 that the ARB price
found a floor after a 30% price decline. Now, this price level is
also the frontier in the 4 hours, which bulls should defend at all
costs. It is the support line in a descending triangle pattern that
has been forming over the past two weeks. The descending triangle
is a bearish pattern that anticipates a breakdown to the downside.
In order to invalidate the chart pattern, the ARB price must break
the resistance line to the upside in the next few days. The support
line was defended by the buy side several times recently. However,
now is the time to make the breakout to the upside. Related
Reading: Arbitrum (ARB) Price Displays Strength, Backed By On-Chain
Activity However, the ARB price must overcome not only the
ascending trendline, but also the 50-EMA (orange) and the 200-EMA
(blue) in the 4-hour chart. Otherwise, a plunge towards the support
at $1.20 can be expected. The RSI is trending downwards in the
4-hour chart and was at 42 at press time. A further price drop
could generate a sell signal. In the daily chart, the RSI is
showing a weakness and is hovering around the lower edge of the
neutral zone. Bullish Scenario For ARB In a bullish scenario,
Arbitrum manages to break out of the descending triangle pattern to
the upside, initiating a rally to the 23.6% Fibonacci retracement
level at $1.4071. Major selling pressure is expected at this point.
If the buy side succeeds in breaking above this resistance, the
focus shifts to the heavy resistance zone at $1.48 (38.2%
Fibonacci). The ARB price already failed here in two attempts at
the end of April. Related Reading: Bullish Momentum Expected For
ARB As Arbitrum Completes DAO Airdrop However, if the buy side can
also crush this resistance, a subsequent rise to $1.6122 (61.8%
Fibonacci) is possible. If Arbitrum also breaks through this price
hurdle in the coming weeks, a retest of the previous month’s high
at $1.82 seems more than likely. Featured image from iStock, chart
from TradingView.com
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