Arbitrum (ARB) Declines

Arbitrum (ARB) has declined by 12.32% over the past month.
99% of Arbitrum holders are currently at a loss despite attempts to reverse the trend.

Over the past three months, Arbitrum has been trading within a descending trendline, experiencing significant losses from a local high of $0.8 to a low of $0.34. As of now, Arbitrum is trading at $0.38, reflecting a 12.32% decline over the month, with daily and weekly bearish trends at 1.62% and 8.18%, respectively.

The ongoing downtrend has heavily impacted ARB holders’ profit margins. Currently, 0% of holders are in profit, meaning 99% are at a loss, with only 1% at breakeven. This phenomenon also occurred a month ago when Arbitrum dipped to $0.42 but later recovered to $0.51.

With the majority of holders at a loss, current market prices fall below buying costs, indicated by an extreme negative MVRV long/short difference. Long-term holders (LTHs) have seen their profit margins drop to a three-month low of -30%, suggesting that they may decide to sell to mitigate losses. If many holders opt to sell, this could create higher selling pressure.

Historically, when 0% of holders are in profit, it presents a buying opportunity as buyers may reenter the market. This decline could potentially allow for Arbitrum’s recovery as buyers look to capitalize on lower prices. Notably, recent market activity has indicated increased buying despite negative spot netflow over the last six days.

What’s Next for ARB?

According to analysis from AMBCrypto, Arbitrum faces strong downward pressure at present. A bearish crossover recently emerged, confirming the continuation of the downtrend. Even though buyers have recently shown interest, they are currently not strong enough to offset sellers, potentially causing Arbitrum to drop to $0.35 if this trend persists. This situation could signal a local bottom while maintaining active buyer interest, possibly leading to a recovery towards $0.44.