Arbitrum’s (ARB) price currently hovers above the crucial resistance level of $1.17. However, this price surge may be short-lived due to the possibility of ARB holders realizing profits and increasing selling pressures.
Will There Be a Sell-Off in ARB?
The altcoin Arbitrum is signaling bearish trends, which could lead to a price decline. The Market Value to Realized Value (MVRV) ratio indicates that a sell-off is likely. The 30-day MVRV ratio stands at 20%, suggesting that investors are in profit and may be inclined to sell.
Historical data reveals that ARB price corrections typically occur when the MVRV ratio is between 7% and 24%, placing it in a danger zone. This sentiment is bolstered by a recent 20% surge in ARB’s price, marking its first significant gain in nearly a month.
Resistance Level Broken
Though realized losses have turned into gains, further profit-taking could drive the price down. ARB recently broke the month-long resistance level of $1.17 and is now trading at $1.18. Despite this, bearish signals suggest that a decline is imminent.
The Ichimoku Cloud, a comprehensive technical indicator, still shows a bearish trend. This indicator provides insights into support, resistance, trend direction, and momentum. As long as the Cloud indicates a downtrend, a positive outcome for ARB seems unlikely. Thus, the price of Arbitrum could drop to $1.1 or even as low as $0.92.
Key Takeaways
Investors should consider the following:
- ARB’s price has broken the $1.17 resistance level but faces potential decline.
- The 30-day MVRV ratio at 20% suggests that further selling could occur.
- Historical data indicates a danger zone within the 7%-24% MVRV range.
- Indicators like the Ichimoku Cloud predict bearish trends.
- Potential price targets are $1.1 and $0.92.
