Arbitrum (ARB), the native cryptocurrency of the Ethereum Layer-2 scaling solution, has seen a sharp decline of 10% in the past week, trading at $0.31. This sustained bearish trend has kept ARB under pressure, with the possibility of revisiting its all-time low looming large. Here’s a closer look at the factors driving this trend.
Ongoing Bearish Momentum
Since peaking at $0.92 in January 2025, ARB has struggled to maintain upward momentum. A recovery in April lifted the token 28% above its all-time low, but the overall trend remains bearish. With its current value barely holding at key support levels, ARB has consistently underperformed in a challenging market environment.
Key Support and Resistance Levels
The In/Out of the Money Around Price (IOMAP) metric sheds light on crucial support and resistance zones for ARB. At $0.31, the token has strong support, but a significant resistance cluster lies at $0.36. Over 250 million ARB, held by 3,560 addresses, remains at a loss, intensifying selling pressure at this level.
ARB In/Out of Money Around Price | Credit: IntoTheBlock
Without a decisive break above this resistance, ARB is unlikely to see a sustained recovery. If selling pressure persists, the token could test lower price levels.
Technical Indicators Signal Weakness
From a technical standpoint, ARB’s outlook is grim. The Money Flow Index (MFI), which previously indicated strong buying pressure at 73.35, has dropped to 58.24, reflecting waning bullish control. The Relative Strength Index (RSI) has also fallen below the 50.00 signal line, further confirming bearish momentum.
Additionally, ARB’s price has been constrained within a descending triangle pattern since January. A breach of the horizontal support in this pattern could push the price down to $0.25, setting a new all-time low.
Potential for Recovery
ARB/USD Daily Chart | Credit: TradingView
Despite the bearish signals, ARB’s price could stage a recovery if market sentiment improves. A breakout above the $0.36 resistance level might propel the token to $0.48, aligning with the 0.236 Fibonacci retracement level. In a more optimistic scenario, ARB’s price could rally to $0.62, driven by increased buying pressure and favourable market conditions.
