Shiba Inu (SHIB) has experienced a challenging week, dropping 13% in value. Despite this decline, whale investors remain confident. They have steadily increased their holdings over the past few weeks, indicating strong interest in the meme coin.
Whale Accumulation Signals Confidence
Recent assessments reveal that a group of whale investors, holding between 10,000 and 100,000 SHIB, has boosted their supply. They now control 3.06 billion SHIB, up from 3.01 billion just a month ago. This 2% increase reflects their belief in SHIB’s potential for recovery.
Whales likely view SHIB as undervalued, particularly throughout September. The market value to realized value (MVRV) ratio supports this perspective. For most of September, SHIB’s 30-day and 90-day MVRV ratios remained negative. This situation suggests that the coin traded below its historical value, prompting whales to accumulate more tokens.
Short-Term Holders Create Downward Pressure
In contrast to the whales, short-term holders (STHs) have adopted a more cautious approach. These investors have held their coins for less than 30 days and are known for their “paper hands.” Recently, they have begun selling off their SHIB holdings, which adds significant downward pressure on the price.
This selling activity is noteworthy because STHs control a considerable portion of SHIB’s circulating supply. Their risk-averse nature means they tend to sell at the first sign of trouble. Consequently, their actions can significantly impact SHIB’s price trajectory.
Price Predictions Amid Market Dynamics
The falling on-balance volume (OBV) further illustrates the selling pressure from STHs. Currently at 24.79 trillion, SHIB’s OBV has maintained a downward trend since early October. A declining OBV typically signals bearish sentiment and suggests potential downward price movement.
If demand for SHIB continues to decline, it may revisit its August 5 low of $0.000010. However, if STHs shift their stance and begin accumulating, analysts predict a potential rally of up to 69%. This rally could test resistance levels around $0.000028.
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In conclusion, while whale activity indicates long-term confidence in Shiba Inu, short-term holders pose a significant risk to immediate price recovery. The interplay between these groups will shape SHIB’s future in the volatile cryptocurrency market.
