SHIB Burn Surge: Rally or Further Dip?
Shiba Inu’s 2532.14% Burn Surge: Impact on Price?
Shiba Inu (SHIB) experienced a significant 2532.14% increase in token burns over 24 hours. While this reduction in circulating supply is generally bullish, SHIB's price simultaneously fell 6.16%, trading at $0.00001469 at the time of writing. This begs the question: can a massive burn event overcome bearish market sentiment?
Technical Analysis: Head and Shoulders Pattern
SHIB's price chart displays a classic head and shoulders pattern, often indicative of a bearish trend reversal. Support sits around $0.0000147. A breakdown below this level could trigger a decline toward $0.00001261. Conversely, holding this support might lead to a price rebound toward the resistance zone of $0.00001718.
Source: TradingView
On-Chain Analysis: Bearish Signals Prevail
On-chain data reveals a predominantly bearish sentiment. Net network growth increased by only 0.27%, suggesting weak adoption. The "in the money" metric fell 1.06%, indicating many holders are underwater. Large transactions decreased by 9.95%, pointing to reduced institutional interest. This confluence of indicators points to potential downward price pressure.
Source: IntoTheBlock
Liquidation Heatmap: Heightened Risk
The 24-hour liquidation heatmap shows significant liquidations near the $0.0000145 level, further fueling downward pressure. These high-risk zones (represented by yellow and green) suggest the potential for amplified price movements in either direction. The risk of further price decline seems elevated should these liquidations continue.
Source: Coinglass
Conclusion: The Outlook for SHIB
Despite the substantial burn, the overall picture for SHIB remains bearish. While the burn is a positive long-term development, it hasn't yet overcome the negative signals from technical and on-chain analysis. The price will likely remain under pressure until stronger market catalysts emerge or key support levels hold.
Disclaimer: This analysis is for informational purposes only and does not constitute financial advice. Investing in cryptocurrencies involves significant risk.