Shiba Inu [SHIB] has been trading within a triangular pattern for a period of 75 days. This popular meme coin indicated a strong performance ahead in the following months after breaking out of the triangular formation just last week.
Starting from Monday, the 16th of September, the entire cryptocurrency market has been experiencing a bullish trend, with gains of about 7% being observed. In this scenario, Shiba Inu surged by 8%, breaching the local resistance level of $0.000014, potentially signaling another move upwards of 7%-8%.
Decrease in Network Activity
There has been a continuous decline in daily active addresses from May to July, with a stabilization phase noted until late August. Although there was a spike in activity at the start of September, the metric has since declined once again.
This recent dip has resulted in daily activity levels hitting their lowest point since the initial week of February earlier this year. Moreover, network growth has been on a decline since the final week of August.
While the weighted sentiment was notably positive in August, it also suffered a decrease in September, aligning with the trend observed in active addresses and network growth. Consequently, Shiba Inu is not anticipated to witness a surge in demand from a rise in user counts in the near future.
Bearish Sentiment in the Short Term for SHIB
The 30-day MVRV has shown positivity. However, the last significant positive spike was detected on the 24th of August, which was followed by a sharp price correction of 12% over the subsequent three days.
On the 20th of September, there was a noticeable surge in dormant circulation, signaling potential short-term bearish pressure. Additionally, the mean coin age has been on a downward trajectory in the past month, indicating a spread across the network.
As of late, the Open Interest has been rising in conjunction with prices over the past week, indicating a strong bullish sentiment. Although the funding rate displayed high positivity, it has decreased over the last 24 hours.
This decrease in the funding rate hints at a balanced long/short position, although long positions remain favored. Overall, the on-chain metrics are suggesting an imminent selling pressure in the short term.