Arbitrum (ARB) recorded an all-time high in monthly transactions within just 25 days of February despite the base fee for transactions doubling in January. However, despite the surge in on-chain activity, the price of the token has been moving quite lethargically.
Transactions for February crossed 100 million
The transaction count on the Arbitrum chain crossed above 100 million, reaching a new all-time monthly high. The transaction count for February increased by about 15%, with a few more days for the month to end.
The new all-time high is impressive, but what’s more impressive is the fact that the network hit a new all-time high despite Arbitrum increasing its base fee to prevent malicious or manipulative transactions. In January, the Arbitrum network doubled its base fee, or the minimum transaction fee.
Transactions spikes despite base fee doubling
When the base fee is high, every transaction becomes more expensive. High-frequency, low-value transactions (often bots or spam) become less profitable. And this means that attackers can’t cheaply flood the network with meaningless transactions, causing a Denial-of-Service (DoS) attack. This shows that the majority of the transactions were legit.
Despite some good indications of on-chain activity, ARB still continues its downward trend that began in July. The token is now trading inside a bullish falling wedge pattern.
Inside the falling wedge, the buyers accumulate at the lower lows while sellers keep taking profits at lower highs. The action of accumulation at new bottoms and profit taking at new tops continues.
RSI shows bullish divergence
Eventually, the equilibrium will favor the buyers, and at the threshold point, the buyers will outnumber the sellers, and the pattern will break, and ARB prices will appreciate. When ARB breaks out of the pattern, the coin will first test the 50-day moving average at $0.146.
Even the Relative Strength Index indicator is showing a bullish divergence.
While the ARB price makes lower lows, the RSI has made a higher low. This goes to show that although ARB prices have not shown improvement, there is bullish momentum building behind the scenes.
