Arbitrum falls below $2: How long till ARB regains its footing?

Journalist

Posted: February 23, 2024

• Close to one million ARB has been sold by a single entity in the last 24 hours.
• The fund inflow has reduced in the past few days.

Arbitrum [ARB] has recently experienced a decline in its price, following a period during which it attempted to establish a new price level.

The fall can be attributed in part to the heightened selling pressure it has encountered over the past few days.

Arbitrum drops below $2

AMBCrypto’s examination of the Arbitrum price on a daily timeframe chart showed a notable decline in the past few days. This was particularly significant, given the prior attempts to initiate an upward trend.

Specifically, between the 20th and the 21st of February, ARB’s price experienced an 8.78% decrease, causing it to drop from the $2 range.

At the time of this writing, there has been a marginal 0.2% increase, and ARB was trading at about $1.88.

Source: Trading View

Furthermore, the chart’s volume analysis showed that during the two days of decline, selling volume dominated the overall volume trend.

Additionally, the short moving average (yellow line), previously acting as support, has now transitioned to resistance around $1.9 and $2.

The Relative Strength Index (RSI) also showed that ARB was in a bear trend. At the time of this writing, the RSI was below the neutral line, suggesting a bearish trend, albeit a relatively weak one.

Sell-offs contribute to price decline

Per Spot on Chain, the recent decline in Arbitrum’s price may be linked to a significant sell-off by Convex Finance.

Notably, Convex sold 901,392 ARB in the last 24 hours, worth $1.63 million, with a selling price of around $1.8 per ARB token.

For the uninitiated, when Convex received ARB in an airdrop back in April 2023, it was worth around $1.2 million. This implied that Convex garnered a profit of over $400,000 with the recent sales.

Interest in ARB drops

AMBCrypto’s look at the derivative aspect of Arbitrum showed relatively low interest in ARB at press time.

Realistic or not, here’s ARB market cap in BTC’s terms

The Open Interest on Coinglass showed a decrease in funds, with the number standing at about $254 million at the time of this writing. 

At the time of this writing, the Funding Rate stood at around 0.014%, indicating that buyers still maintained control, albeit with less aggressiveness.