Arbitrum (ARB) has experienced a downward trend since March’s mini bull run, with its price recently declining by 1.4% to approximately $0.546. However, recent developments within the Arbitrum ecosystem hint at a potential bullish reversal, potentially driving ARB’s price up by over 50% in the short term.
What Does the ARB Staking Proposal Involve?
The Arbitrum DAO recently approved a pivotal proposal aimed at introducing ARB staking on the Layer-2 network. Presented by Arbitrum delegate Frission, the initiative was driven by concerns over ARB’s struggle to gain value and fulfill its role as a governance token. The proposal received overwhelming support, with 91% of over 25,000 voters in favor.
Following this approval, an on-chain proposal will be submitted on Tally to secure $200,000 in funding for developing the staking platform. If accepted, this significant milestone for the Arbitrum network is expected to commence in August.
Does Technical Analysis Support a Bullish Breakout?
Despite ARB’s recent price downtrend, technical analysis suggests a potential reversal. The altcoin’s price chart shows a descending wedge formation, typically a bullish reversal indicator. Furthermore, ARB is trading below its 21 and 50 Exponential Moving Averages, key resistance levels. However, recent higher highs since August 8 hint at an impending breakout.
If ARB successfully exits the descending wedge formation, it could surge by around 51.48% to a resistance level near $0.8124. Data from Coinglass shows a substantial buy wall with over $1.276 million in unfilled buy limit orders between $0.52 and $0.53, which could maintain momentum. Conversely, a breakdown below this level might lead to a further decline to $0.49.
Concrete Insights and Takeaways
– Approval of the ARB staking proposal has strong community backing with 91% support.
– The on-chain proposal seeks $200,000 for staking platform development, expected to start in August.
– Technical analysis suggests a 51.48% potential rise if ARB breaks out from the descending wedge.
– A significant buy wall at $0.52-$0.53 could sustain upward momentum, while a drop below this range may signal further weakness.
In conclusion, while ARB is currently in a downtrend, recent developments and technical indicators present a promising outlook for a potential bullish breakout.