After delivering a 13% negative performance in March, Shiba Inu (SHIB) has declined by another 5% since the start of April. On-chain analysis reveals how a dearth in whale transactions and slowing network growth could trigger further price downswing. Where will SHIB find support?
Shiba Inu kicked off 2023 with a widely-publicized token burn plan. As Q2 rolls by, investors appear unconvinced about the deflationary effect of the burn on price action. After a see-saw performance in March, the second-largest meme coin by market capitalization is still flashing bearish on-chain signals.
Shiba Inu Whales are Folding
According to the data analytics provided by Santiment, Shiba Inu whales have tuned down their trading activity considerably in recent weeks. The graph below shows that the number of large transactions involving SHIB has been in decline since the recent year-to-date market top in February.
Since Feb. 5, the number of Shiba Inu Large transactions has declined by 94% from 583 to a dismal 35 transactions as of April 12.
The Large transactions metrics track the daily number of trades worth $100,000 and above on a blockchain network. A consistent decline could imply that large institutional investors are losing confidence in the short-term price prospects of SHIB.
Similarly, the downward trend in new-user acquisition on the Shiba Inu network is another potential cause for concern among investors.
According to data compiled by Santiment, Shiba Inu has witnessed a 65% drop in new wallet addresses created since the recent local high. Between Feb. 4 and April 12, the Shiba Inu network growth has regressed from 4,575 to 1,581 new addresses.
Network Growth measures the aggregate number of new wallet addresses created daily on a blockchain network. A persistent drop could mean that the SHIB meme coin is losing market share and traction.
In summary, if the whale transactions and network growth metrics remain in decline, SHIB holders can expect more price downswings.
SHIB Price Prediction: Road to $0.000009
Going by IntoTheBlock’s Break Even price distribution data, the Shiba Inu token could soon hit $0.000009 if the bearish outlook plays out.
The bears can gazump the bulls if SHIB fails to hold its current support at $0.000011. Although, the support of 58,000 addresses holding 32 trillion tokens will attempt to shore up the price.
If that support line breaks, then SHIB may decline toward $0.000009, where 298,000 addresses holding 140 trillion tokens could stand firm.
Still, the bulls can take charge if the SHIB price breaks above $0.000012. A cluster of 58,000 break-even addresses holding 32 trillion tokens in this zone may look to book some profit.
But, if Shiba Inu scales that zone, a price rally toward $0.000017 is possible. However, a more significant resistance of 287,000 addresses holding 532 trillion tokens could certainly stand in the way.
Disclaimer
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