It's time for some more chart analysis! Today, I take a closer look at Arbitrum and try to find out if the token offers a promising trade setup. Let's dive in 👇
1️⃣ Current Chart Situation • Arbitrum (ARB) broke out of its long-term downtrend in early September after forming a double bottom at ~$0.48. • While technically out of the downtrend, two critical elements are still missing: a more robust pump and significant volume increase. This makes it hard to call it a confirmed breakout just yet. • Moreover, the volume has been declining throughout the entire downtrend. Unfortunately, we haven’t seen a decisive reversal in this trend. • ARB is currently battling the $0.60 resistance level, which has been rejected so far.
2️⃣ Trade Setup If ARB breaks above the $0.60 resistance, a potential long entry could be in play, targeting a move above $0.80. However, I’m cautious about entering without a solid volume confirmation.
So, here’s how I would approach this trade: • Entry: After a daily close above $0.62, but ONLY if the breakout is accompanied by high volume. • Stop Loss: Around $0.58 to manage risk. • Target: $0.82, offering a profit potential of ~34%. • Risk/Reward Ratio: Over 6, making this a solid trade if volume supports it.
❌ Without the volume confirmation, the risk remains too high, and I would not consider entering. Always prioritize risk management!
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