Shiba Inu [SHIB] was priced at $0.0000186 at the time of writing, registering a slight 0.9% increase in the last 24 hours. However, this popular meme coin has declined nearly 7% over the past seven days.
One possible reason for SHIB’s recent performance could be the decrease in wallet profitability, impacting investor confidence.
Decline in Profitable Wallets Reaches a Three-Month Low
The total number of profitable Shiba Inu wallets has fallen to 676,500 addresses, marking its lowest point in three months. Currently, just 47% of SHIB holders are in profit, while 49% are facing losses.
Historically, SHIB’s price surge has aligned with an increase in the number of profitable wallets. Therefore, a higher number of traders experiencing losses could lead to further downturns for SHIB.
Traders seeking to limit losses may introduce additional selling pressure on the meme coin, potentially triggering a pullback.
Significance of a Decreasing MVRV on Price Movements
Shiba Inu’s Market Value to Realized Value (MVRV) ratio has declined to 0.907, marking its lowest level since early November 2024. This drop implies that the average holder is now making fewer profits from their SHIB holdings.
A lower MVRV might result in reduced selling pressure, as diminishing profits decrease the motivation to sell. Nevertheless, this reduction could also lead to further declines if buyer demand remains weak.
Technical Analysis of SHIB Price Movement
An analysis of Shiba Inu’s daily chart reveals that selling pressure has exceeded buying pressure, with the Relative Strength Index (RSI) dropping to 36, indicating a bearish trend.
Currently, the RSI is showing signs of an upward trend, hinting at increased buying activity. A potential crossover above the signal line could bolster buying momentum.
Simultaneously, the Average Directional Index (ADX) is on the rise, suggesting the continued strength of the downtrend. Traders need to monitor the ADX line for any indications of a bullish reversal.
SHIB has tested resistance at the 0.786 Fibonacci level ($0.0000189). If it breaks this barrier and extends its gains, the next target price for the meme coin stands at $0.0000212.
Increase in Open Interest Indicates Growing Market Speculation
Data from Coinglass highlights a notable decrease in Shiba Inu’s Open Interest (OI) to $351 million, which has now risen slightly to $348 million in the last 24 hours, signaling increased trading activity.
A continued rise in OI would indicate growing speculative interest that could potentially support an upward price trend. Long positions are currently dominant in the market, likely influenced by favorable Funding Rates.