Arbitrum has faced significant downward pressure over the past month, experiencing a 12.32% decline in its price, with a notable impact on its holders. As of now, the altcoin is trading at $0.38, leaving 99% of Arbitrum holders in a loss. The token has been following a persistent downward trend for several months, with its value dropping from a local high of $0.80 to a low of $0.34.

Over the past three months, Arbitrum has been trapped within a descending trendline, which has contributed to the significant losses. Despite brief recoveries, the price has continued to move lower, raising concerns among investors about the future trajectory of the asset. With the recent 12% drop, Arbitrum’s overall market sentiment remains bearish, as the coin struggles to break free from the downward trend that has affected it consistently.

The major concern for holders is the fact that a staggering 99% of them are currently at a loss. Data from IntoTheBlock suggests that 0% of Arbitrum holders are in profit, with the vast majority of them sitting on negative returns. This pattern has emerged before, notably a month ago when Arbitrum’s price dropped to $0.42 before briefly recovering to $0.51. However, this recovery was short-lived, and the downward trend resumed.

The situation is particularly challenging for long-term holders, with the MVRV (Market Value to Realized Value) ratio showing that long-term holders are now at a loss of around 30%. This indicates that the majority of long-term holders purchased Arbitrum at higher prices and are now facing significant unrealized losses. When this happens, many holders tend to panic sell to minimize their losses, which can increase selling pressure and drive the price even lower.

However, historically, periods where the MVRV ratio is deeply negative have been viewed as buying opportunities. When no holders are in profit, there is a tendency for new buyers to reenter the market, hoping to capitalize on a potential rebound. As seen in the past, when holders experience extended periods of loss, it often signals a local bottom, which can attract buyers looking to take advantage of low prices. Over the past six days, there has been evidence of buying activity, as reflected by negative spot netflows, indicating that buying volume is surpassing selling activity.

Despite the presence of buying interest, the market still faces strong downward pressure. On the technical side, a recent bearish crossover has occurred on the Stochastic oscillator, reinforcing the ongoing bearish trend. This crossover suggests that the downward momentum is likely to continue, and the price could dip further, potentially reaching $0.35 if the selling pressure persists. While there are some signs of buyer activity, they have not yet been able to overpower the sellers, and the market remains vulnerable to further declines.

However, there may still be hope for a reversal in the near future. The recent increase in buying activity could signal that a local bottom is forming, potentially leading to a price rebound. If buyers continue to accumulate at these low levels, Arbitrum could experience a rally, reclaiming the $0.44 mark. For now, the market remains uncertain, and investors should keep an eye on price action and sentiment to determine whether a reversal is on the horizon.

In conclusion, Arbitrum is facing significant challenges, with 99% of holders currently at a loss. While selling pressure remains strong, the ongoing buying activity may signal a potential buying opportunity. Investors should monitor technical indicators and market sentiment closely to assess whether a reversal is likely in the near future.