Many participants in the Layer-2 ecosystem have seen a rise recently. One of them is Arbitrum (ARB), which has been frequently mentioned due to recent declines. In the last 7 days, the ARB price increased by 10% and continues to find buyers within a rising channel. As of the time of writing, ARB is trading at $0.76.
Arbitrum Price Outlook
Arbitrum has seen a double-digit price increase, forming a rising channel on the charts. A rising channel is generally interpreted as a bullish formation and is a bullish signal when the price of the examined asset moves between two upward-sloping parallel lines. The upper line of the channel serves as resistance, while the lower line is considered support.
Since July 4, ARB has been trading within the mentioned channel, increasing its value by 17% during this period. On Monday, it was observed that for the first time since June 5, ARB managed to stay above the 20-day Exponential Moving Average (EMA) and closed there.
Generally, being above the 20-day EMA reflects an upward trend for the examined asset. Staying above the mentioned level indicates that the price of the examined asset is rising and the upward trend may continue.
On the other hand, the Chaikin Money Flow (CMF), which shows the inflows and outflows of funds in the market, presented a positive outlook for ARB, which seems to contribute to the rise. As of the time of writing, the CMF value remains above zero at 0.01.
The Future of ARB
It was observed that the demand for ARB was gradually decreasing, which can be interpreted as a negative situation during the price increase period. Data provided by IntoTheBlock showed a 2% decrease in the number of addresses created by people wanting to trade ARB in the last seven days. On the other hand, it was also observed that the number of active addresses that performed one or more transactions specific to ARB decreased by 10% during the same period.
It is emphasized that the current trend needs to change for the upward outlook on ARB to progress sustainably. If demand increases and market conditions are favorable, the price could rise again to $0.99. However, if investors in the market prefer to take profits, the ARB price could drop to $0.55.
