Arbitrum (ARB) price has climbed back up 13% from the $1.10 support level to hit $1.24 on Tuesday. This comes after bearish sentiment dominated the market in the first half of May, with bullish Arbitrum whales now taking over. The question is for how long will the ARB price rally last?

This week, the ARB bulls have successfully broken the $1.20 resistance, thus overturning the negative market sentiment. On-chain data reveals that Arbitrum whales are divided into two camps, with opposing positions. Will the recent spike in Arbitrum network activity convince the bulls to consolidate long positions and stay in the driving seat?

Bullish Arbitrum Whales Have Taken the Lead

On-chain data shows that since mid-May, Arbitrum whales have split into two camps. The largest cohort, holding 10 million to 100 million ARB balances, has taken a largely bearish position. Conversely, those holding 100,000 to 10 million tokens have assumed a bullish stance.

Red and blue color-coded whales are depicted in the chart below. The bearish whales, shown in red, sold off 190 million tokens between May 18 and May 30. Meanwhile, the bullish whales, shown in blue, bought 191.2 million ARB tokens in the same period. At the current ARB market price of $1.22, the Arbitrum bulls have invested $233.2 million to overrule the $231.8 million sell-pressure from the bearish whales. Although the bulls only lead by a small margin, it could inspire retail investors and neutral institutional holders to take bullish positions, thus giving the ARB price rally more momentum in the coming days.

Network Activity Has Spiked 350%

The Arbitrum network saw a 350% spike in user activity on May 30, lending credibility to the bullish Arbitrum price prediction. The preceding day, the network had recorded 12,400 daily active addresses, which shot up to 55,700 the next day. Interestingly, this figure is even higher than that recorded within the previous four days combined. The Daily Active Addresses metric sums up the number of unique wallet addresses that engage in on-chain transactions in a single day, and it’s usually positively correlated with the price since it indicates increased demand for the underlying service rendered. When there’s a sudden spike in transactional activity, it tends to trigger market participants to take up bullish positions, consequently putting more upward pressure on the Arbitrum price.

ARB Price Prediction: $1.50 Could be the Next Target

If the bullish Abritrum whales continue to double down on their long positions, the ARB price could surge closer to $1.50 before retracing. Current prices sit at $1.22; therefore, the Market-Value to Realized-Value (MVRV) data indicates that recent investors in ARB are holding unrealized profits of 6%. Given the bullish momentum, most ARB investors are likely to stay put for 4% gains before cashing out around $1.27. If the ARB price manages to surge past that resistance level, it could inch closer to its $1.5 price target. If, however, the bears successfully drive the price unexpectedly below $1.15, they could overturn the bullish narrative. In this case, many Arbitrum investors will provide bullish support at that key area in a bid to avoid a net-loss position. Otherwise, ARB could slip further towards the next significant support level, which is $1.