Key Takeaways
Arbitrum (ARB) reached its all-time high and low 2024 in January and August, respectively. The decline from one to the other measured 82%. Nevertheless, the price of Arbitrum has recovered since its low and created several higher lows.
Is the Arbitrum downward trend finally over, and if so, how long will the upward movement last? Let’s find out.
The ARB price has decreased under a descending resistance trend line since its all-time high price of $2.42 in January.
The downward movement culminated with a new all-time low of $1.43 on Aug. 5.
While the Arbitrum price bounced afterward, it has not started a strong upward movement yet. On the contrary, the price still trades under the $0.80 horizontal resistance area and the descending resistance trend line, which coincides with the area.
On a more positive note, the weekly Relative Strength Index (RSI) and Moving Average Convergence/Divergence (MACD) are developing some bullish signs.
More specifically, the former has generated a bullish divergence (green), while the latter has made a bullish cross (white icon).
However, neither is above their bullish and bearish thresholds at 50 and 0, respectively.
As a result, the weekly time frame Arbitrum price readings are negative, indicating a bearish trend.
The daily time frame ARB price chart shows a completed five-wave decline (white) since the all-time high.
This fits the bearish long-term readings, implying that the long-term ARB trend is bearish. However, since the decline is completed, a relief rally may follow.
Besides the long-term diagonal and horizontal resistance at $0.80, the closest Fib resistance is $1.20, created by the 0.382 Fibonacci retracement resistance level.
A closer look at the six-hour time frame shows that the increase after the Aug. 5 lows could be an A-B-C structure, defined by the ascending parallel channel in wave B.
If waves A:C have a 1:1.61 ratio, the ARB price will likely reach a high of $0.85. If this is the case, the price of ARB will not break out from its long-term resistance trend line; rather, it will be rejected by it and fall to new lows.
So, while a relief rally is likely, it may not be strong enough to break out from the long-term confluence of resistances near $0.80.
The Arbitrum price has likely started an upward movement with its bounce on Aug. 5. On Oct. 3; ARB bounced again at the support trend line of a short-term channel.
However, the wave count suggests the increase will be just a relief rally and could end near the $0.80-$0.85 region.