Shiba Inu network growth closed negative for the second consecutive month. Will retail interest gain momentum in March 2023 and help SHIB surpass its February performance?
Shiba Inu Holders Brace For Sell Action
Shiba Inu (SHIB) delivered a 23% price slump in February, cooling off its strong start to 2023. Following a brief resurgence in mid-February, SHIB has re-entered the bearish zone. Holders appear to be positioning for some sell action in the coming days.
Illustrated below, daily active deposits by SHIB holders have risen compared to values recorded ahead of the late December rally.
According to Santiment, a pictorial comparison of active deposits to active withdrawals data shows that more holders transfer their SHIB into exchanges than those withdrawing it. Historically, Shiba Inu price tends to fall when deposits persistently outpace withdrawals.
If the SHIB holders continue to deposit more tokens on exchanges in the coming days, the meme coin is likely to make a slow start to March 2023.
Another on-chain data that flashes a bearish signal is the persistent decline in network activity. After peaking at 6,000 on January 18, the number of new SHIB addresses created has continued to hit new lows, closing February at 1,800.
This downward trend in network growth is a critical metric that shows that SHIB has not been attracting new crypto market participants in recent weeks. For the current bearish price action to be reversed, SHIB has to find new demand in March 2023.
SHIB Price Prediction: Tough Times Ahead
Regarding price action, the distribution of holders who bought SHIB around the current prices can also be seen as negative.
The Global In/Out of Money Around Price (IOMAP) by IntoTheBlock shows that the market can anticipate a further decline if SHIB breaks below its current support at $0.000010. The next area of demand could be around $0.000006, where 164,000 addresses bought nearly 55 trillion SHIB.
Still, if Shiba Inu price rises above the $0.000017 resistance, this could trigger a rally toward $0.000035. This could be easier said than done with more than 99,000 addresses bought over 468 trillion SHIB at an average price of $0.000017.
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