Arbitrum’s (ARB) price is in for a major drawdown looking at not just the chart pattern but also the investors’ behavior.
Whether ARB ends up dropping to $0 or save skin before then is something to look out for.
Arbitrum Investors Prepared for Losses
Arbitrum’s price could be looking at a new all-time low as the optimism among ARB holders has completely vanished. Arbitrum investors have been experiencing consistent losses on their transactions since mid-April. This ongoing trend is clearly highlighted by the Realized Profit/Loss metric, which underscores the financial challenges faced by the investors.
The persistent losses have significantly impacted investor sentiment, leading to a noticeable shift in behavior. Previously, many investors adopted a HODLing strategy, holding onto their assets in anticipation of long-term gains.
However, the sentiment of HODLing among Arbitrum investors has completely disappeared. The prolonged period of losses has eroded their confidence in this approach.
As a result, investors are now focusing on distribution strategies, as indicated by the mean coin age metric. Mean coin age measures the average age of all coins in a network, reflecting how long they’ve been held without being moved.
An increasing mean coin age suggests accumulation and holding, while a decreasing age indicates higher trading activity. This shift suggests a preference for liquidating assets rather than holding onto them, reflecting a more cautious and reactive investment approach.
Read More: How to Buy Arbitrum (ARB) and Everything You Need to Know
ARB Price Prediction: Forming New Lows
Arbitrum’s price is observing the formation of a head and shoulders pattern. The head and shoulders pattern is a bearish chart formation indicating a potential trend reversal. It consists of three peaks: a higher middle peak (head) between two lower peaks (shoulders).
Based on the technical pattern, the potential drawdown could send the altcoin down to $0 as the target is 100% below the neckline at $0.92. However, this is impossible since even during the FTX collapse, its native token, FTT, did not slip to $0.
Thus, the more practical outcome is Arbitrum’s price hitting a new all-time low. The current ATL lies at $0.73 and marking a lower low below this would not be surprising.
Read More: Arbitrum (ARB) Price Prediction 2024/2025/2035
But if by the mercy of ARB holders, the altcoin manages to bounce back Arbitrum’s price could bounce back. Potentially breaching the neckline at $0.92 will enable recovery and reclaiming $1.0 will invalidate the bearish thesis.
Disclaimer
In line with the Trust Project guidelines, this price analysis article is for informational purposes only and should not be considered financial or investment advice. BeInCrypto is committed to accurate, unbiased reporting, but market conditions are subject to change without notice. Always conduct your own research and consult with a professional before making any financial decisions. Please note that our Terms and Conditions, Privacy Policy, and Disclaimers have been updated.
Credit: Source link
