Shiba Inu (SHIB) is at risk of further price declines based on several on-chain metrics, signaling a bearish sentiment in the ecosystem. This could no doubt present a setback for the meme coin, which is showing signs of recovery following a significant price correction.
Shiba Inu Network Growth Is On The Decline
According to data from the market intelligence platform IntoTheBlock, Shiba Inu’s net network growth has declined by 0.48%. This metric measures the total number of addresses holding the SHIB token, and a decline shows that some addresses have offloaded their tokens in the past week.
The ‘In The Money’ metric also signals a bearish sentiment in the SHIB ecosystem, with a 0.20% decline in the past week. This metric measures how many SHIB holders are in profit, and right now, it seems that most of them are at a loss with their SHIB holdings. However, this metric could quickly turn bullish again as SHIB moves to the upside.
The number of large transactions on the network is another metric highlighting the bearish sentiment in the SHIB ecosystem. Data from IntoTheBlock shows that whale activity on the network has declined by over 10% this past week. In this context, a large transaction refers to one of over $100,000, meaning that whales’ activity on the network has cooled off.
The decline in this metric is concerning, considering that Shiba Inu whales reportedly hold 73% of the token’s circulating supply and play a major role in SHIB’s price discovery. Meanwhile, the cool-off in whale activity on the network is also evident in the ‘Concentration’ metric, which is neither bullish nor bearish at the moment, according to IntoTheBlock’s data.
The Concentration metric measures daily changes in the position of whales, meaning that SHIB whales are currently opting against accumulating more of the meme coin in their portfolio.
The Silver Lining
Data from IntoTheBlock shows that the ‘Bid-Ask Volume Imbalance’ is currently bullish, suggesting that SHIB investors are again accumulating the meme coin. This is a positive development as the buy orders can help trigger a surge in SHIB’s price. Moreover, the other on-chain signals could again turn bullish following an increase in SHIB’s value.
It is also worth noting that the overall outlook for the SHIB token remains bullish. Several crypto analysts predict that the meme coin will be among the leading gainers in this market cycle. Crypto analysts like Altcoin Sherpa have even predicted that SHIB could eventually replace Dogecoin (DOGE) as the most valuable meme coin.
At the time of writing, SHIB is trading at around $0.00002667, up in the last 24 hours according to data from CoinMarketCap.
SHIB lingers at $0.000026 | Source: SHIBUSDT on Tradingview.com
Featured image from Analytics Insight, chart from Tradingview.com