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- A whale has sold millions of ARB tokens despite not being in profit.
- Buying pressure has dried up, indicating a further plunge below $1.05.
- If bulls are able to defend the $1 region, ARB may retest $1.12 in no time.
According to Lookonchain, an Arbitrum whale is dumping millions of ARB tokens again. This whale was identified by the smart money tracking platform Lookonchain on November 17, when their wallet was spotted selling ARB tokens at a loss. This time, it did not seem any different as the same whale sold ARB at $1.05 after buying at $1.23, at a loss of $6 million.
The giant whale has dumped all 14M $ARB($14.84M) at ~$1.05 since Nov 16.The whale withdrew 22.55M $ARB($27.76M) at ~$1.23 from #Binance and #Gateio in April.And also deposited 8.44M $ARB($6.92M) to #Binance at $0.82 in Sept.The total loss is $6M.https://t.co/46fMtKikbd pic.twitter.com/D2JRsGaGk3— Lookonchain (@lookonchain) November 20, 2023
ARB Profit-Taking Rules
According to CoinMarketCap, Arbitrum has lost 7.98% of its value in the last seven days.
The decrease in price could be linked to the whale dump. Besides that, ARB’s 30-day performance was a 32.16% increase. So, there is also the possibility that profit-taking by those who bought the token at a discount has begun.
Based on the 4-hour chart, ARB fell below the $1.07 breakout of November 15. This was after it faced stiff resistance at $1.17 a day after it rallied. Falling to $1.00 on November 17 meant that buying pressure had dried up.
Furthermore, there has been a downward crossover of the 20 EMA below the 50 EMA. This indicates that there could be a steeper correction over the next few days. Should bulls fail to propel an ARB uptrend, then there is a chance the token will fall back to $1.
Also, a break below $1 may be possible if the bulls fail to defend the support around the region. For long-term traders, a further fall in the price would be favorable as it could be an opportunity to take advantage of the next uptrend.
ARB/USD 4-Hour Chart (Source: TradingView)
Bulls Have a Slim Chance
On the contrary, if buyers are able to sustain ARB above the $1 channel, it will suggest that the correction may be over. Should this happen, ARB may first target $1.12, which was a major demand zone on November 15.
Subsequently, a move above $1.12 may give a clear advantage to the bulls. However, the current market sentiment indicates that a swift recovery is unlikely in the short term.
Meanwhile, ARB is still 91.13% down from its all-time high. Considering the hype it still has in the market, the token can be said to be undervalued. In a full-blown bull market, there is a chance that ARB takes a large part of its holders into profit.
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