Arbitrum (ARB) Aims to Recover 15% Loss Amidst Ongoing Market Struggles

Key Takeaways

• Arbitrum price dropped double-digits in one month, but distribution has decreased.
• The altcoin’s social dominance rises, which could increase demand.
• ARB has formed a falling wedge on the daily chart, with a possible rebound coming.

Within the last month, Arbitrum (ARB) has lost 15% of its value. At one point, the native token of the Ethereum layer-2 network traded at $0.96.

But as of this writing, it is down to $0.69. ARB’s price action matches ETH’s, which has also struggled, irrespective of the broader market condition.

However, by the look of things, ARB might be ready to decouple from following ETH’s underwhelming trend. Here is how.

Selling Pressure Around Arbitrum Wanes

One factor keeping Arbitrum’s price on the downside is rising selling pressure. For months, the token failed to attract significant demand, leading to lower market value.

However, according to IntoTheBlock, ARB could be on the verge of a bullish reversal. This is because of the swift change in the holding time of transacted coins.

As the name suggests, coin holding time measures the period a cryptocurrency has been held without being transacted or sold. A decrease in this metric indicates that holders have sold a significant portion of the cryptocurrency.

On the other hand, an increase in the holding time suggests that holders are keeping their assets, potentially anticipating further price gains.

As seen below, the ARB  holding time has spiked, indicating that selling pressure around the token is fading.

If sustained, then ARB’s price might reverse the bearish trend.

In line with the surge in holding time, Santiment data also highlights an increase in Arbitrum’s social dominance.

Social dominance measures the level of discussion around a cryptocurrency about other assets within the top 100.

The higher the social dominance, the more conversations are centered around that asset. Conversely, lower social dominance indicates less attention from the market.

ARB’s social dominance has risen to 0.80% as of this writing. If this trend continues, it will indicate growing interest and demand for ARB, positively affecting its price.

ARB Price Prediction: Time to Retest $1

On the technical side, the ARB price has formed a falling wedge on the daily chart. A falling wedge is a bullish pattern formed by drawing two descending trend lines.

One of the trendlines connecting the lower highs while the other links the lower lows. Typically, this pattern signals a potential bullish reversal, indicating a narrowing price range followed by an upward breakout.

With this already in place for ARB’s price, the token could jump toward the 0.786 Fibonacci level. If validated, this would place ARB’s price at $1.07.

Should buying pressure also increase, the altcoin could hit $1.24.

However, if the price breaks below $0.65, this forecast might not pass. Instead, ARB’s price could move closer to its all-time low.