Ethereum Price Fluctuations Impact ARB, OP Coins Amid Declining Interest
Influence of ETH Price Fluctuations on Arbitrum and Optimism
The price of Ethereum (ETH) has a strong influence on the states of Arbitrum (ARB) and Optimism (OP). If the price of ETH rises, ARB and OP could rise more strongly. However, it currently does not look like this.
Price Development of ARB and OP
In the last seven days, ARB and OP have fallen by double-digit percentages. Despite an earlier rise a few days ago, activity on the Layer-2 networks has decreased. According to an evaluation by AMBCrypto, the value of ARB has dropped by 16% in the last seven days. The price of OP fell by 15%, suggesting that the tokens may have reached a local peak when they rose.
The Role of Ethereum
Optimism and Arbitrum are scaling solutions for Ethereum (ETH). ETH was the main reason for the rise in cryptocurrencies. As beta versions of the altcoin, ARB and OP have a strong correlation with ETH. If the price of ETH rises, the values of the tokens rise more strongly. If the price of ETH falls, the others fall much more strongly. This was clearly seen in the recent crash, when ETH decreased by 5.34%, OP and ARB fell by double-digit percentages.
Outlook for ARB
From a technical perspective, ARB experienced an increase in trading volume when the price rose from $1.64 to $2.40. This happened between January 10th and 12th. However, the volume of the cryptocurrency has dropped, indicating a declining interest. The price at $1.85 seems to be a crucial zone for the token. If sellers break through this zone, ARB could fall to $1.70, which is the next support zone.
Outlook for OP
The market structure of OP on the 4-hour chart was similar to ARB. A look at the EMAs confirmed the bearish trend for the cryptocurrency. The MACD had also fallen into the negative area, emphasizing the bearish dominance. If this remains the case, OP could fall below $3.
Network Growth and Market Capitalization
In terms of network growth, on-chain data showed that both Optimism and Arbitrum experienced increases during the ETF approval period. At this time, Arbitrum’s network growth jumped to 8343, while Optimism rose to 19,000. The increase suggested that new addresses were flowing into the project. But at the current time, the metric had dropped on both sides, suggesting that traction has waned and demand is no longer as high as before.
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Sources: AMBCrypto, TradingView, Santiment.
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