Shiba Inu Faces Potential Price Drop Amid Market Shifts

In A Nutshell

Recent observations have highlighted a potentially turbulent period for Shiba Inu (SHIB) in June, as a significant influx of tokens to exchanges and a declining network growth suggest a pending price correction. Despite the current challenges, there remains a path for recovery contingent on an increase in demand.

Increased Exchange Supply Points to Potential Selling Pressure

Analysis of Shiba Inu’s Exchange Net Position Change, utilizing data from Glassnode, indicates a noteworthy increase of 2.60 trillion tokens moving to exchanges as of June 1st. This inflow often leads to heightened selling pressure, which could precipitate a decrease in SHIB’s price. Historical data from March to mid-May showed a negative net change, hinting at a potential increase in price, yet the token has struggled to capitalize on these movements, with its price remaining relatively flat during April and May.

Diminishing Network Growth Signals Concern

Another critical factor is the Network Growth of Shiba Inu, a metric indicative of new addresses engaging with the token. A report from Santiment showed a downturn in this growth following a peak on May 29th, further supporting the possibility of a price decline. Should demand not see a significant resurgence, SHIB could see its price drop to as low as $0.000020. However, a rebound to $0.000030 is within reach if demand experiences a substantial increase.

Lackluster Circulation and Market Position

Shiba Inu’s one-day circulation figures suggest a decrease in transactional activity, pointing to a waning interest compared to other popular memecoins. Such a trend could result in reduced liquidity for SHIB, complicating any potential for a positive price movement in June unless there’s a notable shift in market dynamics.

Our Take

While the immediate outlook for Shiba Inu appears challenging, with potential selling pressure and declining network engagement signaling a rough June, it’s crucial to remember the volatile nature of cryptocurrency markets. Factors such as an unexpected surge in demand or broader market recovery could quickly alter SHIB’s trajectory. Investors should remain vigilant, monitoring both on-chain and market activities closely. As always, a diversified investment strategy and thorough research are prudent in navigating these uncertain times.