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Shiba Inu is known for its abrupt volatility and has once again demonstrated why. SHIB has seen a sharp 50% drop in large transaction volume over the last week, going from an astounding six trillion tokens transacted in a single day to just 3.65 trillion. A drop of this magnitude rarely happens without repercussions, and the price chart is already displaying cracks even though whales occasionally decrease activity during consolidation.
Based on its daily performance, SHIB recently made an attempt to recover the $0.000014 zone through a rally. Additionally it was able to push back above the 50-day and 100-day EMAs. But once more the 200-day EMA (black line) rejected the advance and sent the price plunging by almost 2% in a single session, proving to be unbeatable. A planned spike to entice retail buyers before larger holders offload into thin liquidity is the textbook distribution of a failed breakout.
There is a concerning correlation between price rejection and the drop in transaction volume. Large transactions are frequently seen as a stand-in for confidence and accumulation, even though they are usually the purview of institutions and whales. This rapid volume evaporation indicates that major players are either quietly distributing or stepping aside.
The last time whale activity on SHIB dropped this much, it came before a multi-week decline that erased more than 30% of market capitalization. Currently SHIB is holding onto the 0.000013 level, which is just above a short-term support confluence. However, there is little chance that this area will be held unless there is a significant increase in transaction flow.
If the subsequent decline comes to pass, the price may return to $0.000012 and even the $0.000011 regions, wiping out the majority of the gains from the July rally. This abrupt drop in token volume of three trillion is simply not a good sign. The likelihood of additional downside is still high, unless whale activity swiftly improves and SHIB can firmly retake the 200 EMA.
Vladislav Sopov
U.Today Editorial Team