Shiba Inu Plunges as Broader Market Rally Fails to Sustain Momentum

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Shiba Inu Plunges as Broader Market Rally Fails to Sustain Momentum

The recent market rally failed to lift Shiba Inu (SHIB) as the memecoin, also known as the Dogecoin Killer, plummeted sharply despite morning gains. SHIB dropped nearly 2% within 24 hours, contrasting with significant gains seen in other areas of the market and within the memecoin category. This decline followed an initial 6% increase earlier in the day, triggered by lower inflation figures, but the Federal Reserve's hawkish outlook led to a more pronounced drop compared to the rest of the market, resulting in a weekly loss of 17% for SHIB.

Various technical indicators painted a bearish picture for SHIB, according to TradingView analysis. The Moving Average Convergence Divergence (MACD) indicator, a widely-used tool to assess asset trends, signaled a negative trend with the crossover of the signal and MACD lines generating sell signals. Additionally, the Momentum Indicator, which compares current prices with past prices, displayed negative values indicating bearish sentiment. The Relative Strength Index (RSI) hovered above 36, showing a neutral signal and tracking the speed and direction of price movements.

The decline in SHIB's burn rate, where 7.1 million tokens were removed from circulation in 24 hours, down by 96%, raised concerns about deflationary pressure weakening. Furthermore, a more than 50% decrease in whale transaction volume for SHIB in the same timeframe, as reported by IntoTheBlock, added to the negative outlook for the memecoin. At the time of reporting, SHIB was trading at $0.00002156 per token, according to data from Benzinga Pro.