Arbitrum (ARB) Price Displays Strength, Backed By On-Chain Activity
May 02 2023 - 9:00AM
NEWSBTC
The Arbitrum (ARB) price has retraced in line with the market-wide
correction over the past few days, falling close to a critical
support level. In the current environment, altcoins in general
continue to show weakness across the board. However, one altcoin
that is exhibiting relative strength, backed by on-chain activity,
is ARB. Arbitrum is an optimistic L2 rollup with the main purpose
of helping Ethereum scale by enabling L2 transactions with much
faster confirmation time. The project has established itself as one
of the top names in decentralized finance (DeFi) in recent months.
Remarkably, it also houses the most popular perpetual DEX with GMX.
ARB Price Shows Relative Strength A look at the ARB/BTC chart
(2-hour chart) shows that the altcoin has formed an uptrend in
recent days. The ascending triangle has its resistance line at
0.00004737. If ARB writes further higher lows against BTC despite
the generally pressured altcoins market, it could ultimately break
through the resistance and rally towards 0.00004850. The 4-hour
chart ARB/USDT reveals that Arbitrum is currently holding just
above the most crucial support level at $1.29. If the price level
is breached to the downside, the $1.20 to $1.24 range would be key.
Related Reading: Bullish Momentum Expected For ARB As Arbitrum
Completes DAO Airdrop To the upside, the key resistance is at
$1.42. However, on the way up the 200-day EMA, currently sitting at
$1.35, could also provide some minor headwinds. Fueled by a Bitcoin
rally, however, the resistance at $1.42 seems within reach without
further ado. Should BTC break above $30,000, ARB bulls could even
target a move up to $1.56. Arbitrum On-Chain Activity Remains Ultra
Strong Arbitrum’s current technical strength on the charts
coincides with its on-chain activity. Most metrics for Arbitrum are
at an all-time high. Most importantly, the growth of the
Arbitrum ecosystem has remained solid after the airdrop, showing
increased activity, as researched by analyst Francesco, who states:
Contrary to what was expected after the airdrop, TVL is rising: GMX
still remains the best perpetual DEX, and Arbitrum still remains
the home of DeFi due to its composability, cheap fees, and fast
confirmation times. Related Reading: Arbitrum Soars 44% To Record
Highs As Whales Splash Millions On ARB Tokens Arbitrum leads on
almost every metric, especially TVL. The fact that more users have
switched to zkSync is most likely due to airdrop hunters.
Arbitrum’s TVL is currently over $2.2 billion, an increase of over
100% compared to the fourth quarter of 2022. The primary reason for
this is the perpetual DEX called GMX, which is Arbitrum’s leading
protocol with over $500 million or 26% of TVL. However, with
Radiant, Stargate and Camelot DEX, Arbitrum based projects also
occupy three more places within the top 6 decentralized exchanges,
underlining the growth of the entire ecosystem. Furthermore,
Arbitrum ranks 4th among all blockchains by TVL, just behind the
layer-1’s Ethereum, Tron, and BSC. Featured image from Nansen,
charts from TradingView.com
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