The broad sell-off in the market led to the erasing of all the gains the memecoin sector had accumulated over the past two months. Shiba Inu, often referred to as the “Doge Killer,” experienced a significant drop from its eagerly watched price of $0.00001, primarily due to the liquidation of long positions. At this point, the price of SHIB is approaching a crucial support, which has traders worried about possible further declines. In addition, a decline in whale activity since the price drop suggests a potentially sharp decline in SHIB’s value.
Whale activity continues to decline
According to data revealed by IntoTheBlock, whale activity within the Shiba Inu ecosystem has seen a notable decline in recent days. The trend accelerated after the market crash, with high-value trades falling by more than $130 million.
The large transaction volume has dropped from $139 million to just $9 million on August 19. However, it has recovered somewhat since then and is currently hovering around $44 million. This is a significant drop in the whale trade. This sharp drop raises concerns about further whale sell-offs, which could lead to a significant drop.
In addition, there has been a steep decline in large transactions (>$100,000) as the statistic fell from its peak of around 170 to just 21. Such a reduction in activity by whales, commonly seen as market influencers, could signal major shifts for the SHIB token’s market direction and value.
Whales’ recent reduced activity in the SHIB ecosystem could lead to reduced market liquidity and increased volatility. Two main conclusions emerge from this trend: First, whales may be consolidating their holdings, waiting for a profitable moment.
Second, these influential players can diversify and redirect their investments to other promising tokens or assets.
What’s next for the SHIB price?
Bulls attempted to push SHIB price above $0.0000084 but faced increased bearish activity. As a result, the price fell to the crucial $0.000008 support line. This likely caused stop-losses on long trades and led to bearish selling. At the time of writing, the price of Shiba Inu is trading at $0.00000811, down more than 2% in the past 24 hours.
The price of SHIB settles near $0.000008, indicating bearish dominance. The downtrend continues to intensify with the bears pulling the price below the 23.6% Fib channel. However, small buys at this lower level give the bulls a little bit of confidence.
If the price successfully recovers from the $0.000008 support, we could see robust buying activity among bulls, pushing the price north. A break above $0.00000883 will send the price back to its old momentum near $0.00001043.
On the other hand, a break below $0.000008 will trigger another wave of selling activity, plunging the price to the $0.0000068-$0.000007 zone where SHIB may consolidate for some time.