1 month ago
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Cryptocurrencies displayed mixed performances, with Bitcoin hovering below $110,000, trading at $109,679.
While analysts view BTC’s weakness as a precedent to an altcoin season, Shiba Inu displayed worrying metrics.
IntoTheBlock stats show a significant plunge in whale activity within the Shiba Inu ecosystem over the past month.
Notably, large inflows plummeted to under 2 trillion from 8 trillion – a staggering 83% fall.
At the same time, outflows dipped by over 80%, reflecting an enormous plunge in large holder transactions.
Such developments indicate liquidity contraction, with large-scale traders (responsible for massive volumes) refraining from active trading.
These trends have shifted attention to the meme token’s price actions.
SHIB’s current price of $0.00001455 places it well below all crucial resistance levels.
While that could confirm a lucrative room for upswings, declining whale activity and liquidity contraction raise concerns.
The dog-themed token needs an approximately 27% price jump to reclaim $0.000020 for stable recoveries.
Can that happen with the prevailing liquidity shrink?
Shiba Inu whales hold back
The notable plunge in outflows and inflows indicates reduced market participation by these entities.
Whales refrain from trading, which could impact SHIB’s ecosystem in various ways.
First and foremost, the altcoin will experience reduced volatility (in the near term).
Whale actions contribute to massive selling and buying pressure, and their absence could mean more stable but slower price actions.
Meanwhile, the meme token will likely experience a substantial liquidity crunch.
📉 SHIB Inflows Crash 83% — Where Did the Whales Go? Shiba Inu failed to break $0.00001596 & now trades sideways near $0.0000145. 🐋 Whale inflows dropped 83% in 30 days 💸 Outflows also down 80% 🪫 Liquidity drying up = bearish risk Next move: Break below $0.0000135 or reclaim
Traders will unlikely execute significant orders with fewer assets moving between exchanges and wallets.
Moreover, these investors could be pulling back as Shiba Inu lacks short-term catalysts.
Such trends align with the broad-based sentiments, where assets witnessed reduced speculations due to a more cautious approach.
Most participants have adopted a wait-and-see strategy while waiting for potential breakouts on either side.
SHIB price outlook
The meme token trades at $0.00001455, well below its mid-January peak of $0.00002437.
Chart by CoinmarketcapShiba Inu has struggled with bearishness since losing the $0.000020 foothold on January 28.
Nevertheless, chart patterns signal potential breakouts.
SHIB’s price actions seem to form a falling wedge – a technical setup often heralding upside movements.
However, Shiba Inu has an uphill task to confirm the technical pattern, especially with its current outlook.
Firstly, the alt should overpower the immediate resistance at $0.000016 – $0.000017 with a massive buying volume – which remains modest.
The project should re-engage whale and retail traders to bolster liquidity levels.
A breakout will see Shiba Inu reclaiming the crucial support at $0.000020 and target the potential profit-taking area between $0.000028 and $0.000031.
Broad-based bullish sentiments and significant ecosystem news could stretch SHIB’s gain to $0.000042 – a nearly 190% uptick from the current price.
However, intensified selling pressure will halt the upside. Shiba Inu could lose 18% to retest the support zone at $0.000012.
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