Shiba Inu (SHIB) faced downward pressure, marking a 1.17% decrease in a 24-hour period. The meme-based cryptocurrency was valued at $0.0000212, with trading volumes dropping by 25% recently.
Despite this dip, various indicators suggest the potential for a trend reversal and an upswing in the near future.
Diminishing Selling Pressure
According to CryptoQuant data, approximately 194 billion SHIB tokens were withdrawn from spot exchanges between January 13th and 14th.
These withdrawals indicate a decrease in selling activity, potentially weakening the current downtrend.
A significant portion of these withdrawals came from whale wallets or large SHIB holders. Insights from IntoTheBlock reveal that netflows for large holders turned negative, shifting from 382B SHIB to -178B SHIB.
These decreasing netflows, nearing a weekly low, suggest that major addresses are reducing their SHIB holdings on exchanges.
Whale movement out of exchanges typically signals a phase of accumulation. These big holders often buy during market lows and sell during peaks. Hence, their accumulation behavior at the current price level could imply that SHIB has reached a bottom.
Despite the easing selling pressure, SHIB has yet to exhibit bullish momentum and continues to display bearish signals.
SHIB’s Bearish Outlook in Descending Triangle Pattern
Shiba Inu’s daily chart reveals a consistent bearish trend as it trades within a descending triangle pattern, signaling a strong downtrend.
The Money Flow Index (MFI) at 55, trending downwards, indicates that despite whale accumulation, the selling pressure still outweighs buying interest.
Similarly, the BBTrend indicator portrays a red and negative trend, affirming the prevailing bearish sentiment.
Analysis of Derivatives Data
Data provided by Coinglass demonstrates a slight increase in Open Interest, reaching $984M, suggesting new positions in the derivatives market.
However, the majority of these positions seem to originate from short sellers anticipating a further decline in SHIB’s price.
This influx of short positions is also reflected in the Long/Short Ratio, dropping to 0.86, indicating a prevailing negative market sentiment.