Arbitrum (ARB) Price Stumbles as Crypto Whales Begin to Offload

The Arbi­trum (ARB) price has retraced toward $1 on Mon­day after an unsuc­cess­ful attempt at reclaim­ing the $1.25 ter­ri­to­ry. On-chain analy­sis uncov­ers major dri­vers behind the recent price retracement. 

ARB price has strug­gled over the past week. With cryp­to whales enter­ing a sell­ing fren­zy, here’s how the ARB price could react. 

On-chain Sleuths Spotted Arbitrum Whales Selling at a Loss

As Arbi­trum price reject­ed the $1.20 ter­ri­to­ry, a group of large investors with­in the ecosys­tem took on a bear­ish dis­po­si­tion. On-chain trans­ac­tion track­er Lookon­chain spot­ted a giant cryp­to whale offload­ing mil­lions of ARB. 

In a Novem­ber 20 post on X (Twit­ter,) Lookon­chain report­ed that the whale ini­tial­ly with­drew 22.55M from Binance and Gateio exchanges in April. As prices wob­bled over the past week, the wal­let sold the tokens at a $6 mil­lion loss between Novem­ber 16 and Novem­ber 20. 

“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.

The total loss is $6M.”

It is a bear­ish sig­nal when cryp­to whales start dump­ing tokens on the mar­ket dur­ing a price cor­rec­tion. Major­ly, whales are per­ceived as sophis­ti­cat­ed traders with a van­tage per­spec­tive of the mar­ket. Hence, it spooks retail investors into tak­ing bear­ish posi­tions when these whales begin to sell. 

Retail Market Demand Has Started to Wane

Fur­ther con­firm­ing the bear­ish stance stat­ed above, on-chain data trends show that retail demand for Arbi­trum is declin­ing. Accord­ing to IntoThe­Block, the ARB tokens trans­act­ed dai­ly have declined since Novem­ber 9. 

The chart below illus­trates that 7.27 mil­lion ARB tokens were trad­ed as Arbi­trum price reached a month­ly peak of $1.21 on Novem­ber 9. But since then, demand has dropped by a whop­ping 70%, with only 2.18 mil­lion tokens trad­ed on Novem­ber 19.

The Trans­ac­tion Vol­ume met­ric tracks the total num­ber of tokens trad­ed on-chain with­in a giv­en peri­od. Typ­i­cal­ly, a sharp decline, as observed above, is a strong indi­ca­tion of declin­ing mar­ket activity. 

In sum­ma­ry, while the whale’s sell­ing activ­i­ty has grabbed media head­lines, on-chain trends show investor dis­in­ter­est across the board. If it per­sists, Arbi­trum could strug­gle to hold the $1 sup­port level.

ARB Price Prediction: Possible Reversal Toward $0.80

From an on-chain stand­point, bear­ish trad­ing activ­i­ty from Arbi­trum whales and declin­ing activ­i­ty in the broad­er retail mar­kets are crit­i­cal fac­tors behind ARB’s recent price decline. With these met­rics still trend­ing bear­ish, Arbi­trum price remains at risk of fur­ther correction. 

The Glob­al In/Out of the Mon­ey (GIOM) data, which groups the cur­rent ARB hold­ers accord­ing to their entry prices, also con­firms this prediction.

It, how­ev­er, shows that the bears must break down the ini­tial sup­port buy wall at $1 to remain in con­trol. As depict­ed below, 1,260 address­es bought 4.57 mil­lion ARB tokens at an aver­age price of $0.98. If those investors HODL firm­ly, they could trig­ger an instant Arbi­trum price rebound. 

But if the bears can push aside the buy-wall, the Arbi­trum price will like­ly drop toward the $0.80 area as predicted. 

Still, the bulls could negate the pes­simistic pre­dic­tion if the ARB price recov­ers $1.25. But, in that case, the 1,370 Arbi­trum address­es that bought 4.85 mil­lion ARB at the min­i­mum price of $1.11 could mount a resis­tance wall. And if they sell ear­ly, Arbi­trum price will like­ly enter anoth­er retracement.

Check out BeInCrypto’s Lat­est Chain Chat­ter Video Below: