Ethereum network upgrade and uptick in Arbitrum active users could trigger an ARB price reversal
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by While the Arbitrum governance token ARB has been in a consistent downturn since the
Funding rates are paid by perpetual swap traders for shorting or longing an asset depending on its demand. If the demand for short orders is higher, it is deemed more expensive, so traders on the short side pay longs.
Currently, the funding rates are near zero, suggesting that futures traders are neutral on ARB.
The ARB/USD pair has observed a downward trend since the token’s launch in March. The compression of the channel shows the possibility of a descending wedge pattern, which has a tendency to break to the upside.
However, if ARB breaks below the support line of the wedge pattern around $0.90, the move to the downside can amplify quickly.
On the ETH scale, ARB broke below May’s low of 0.00057 ETH after the SEC’s lawsuits. At the time of publication, the token was trading at 0.00056 ETH.
Technically, ARB shows the possibility of a negative trend reversal. Nevertheless, the upcoming Dencun update on Ethereum and decisions taken by the Arbitrum Foundation in directing revenue from the L2 rollup will ultimately dictate ARB’s price action.
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This article is for general information purposes and is not intended to be and should not be taken as legal or investment advice. The views, thoughts, and opinions expressed here are the author’s alone and do not necessarily reflect or represent the views and opinions of Cointelegraph.
