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With a sharp spike in exchange inflows indicating renewed sell-side activity across the market, Shiba Inu is clearly under pressure going into the weekend. More than 531 billion SHIB were moved to exchanges in less than a day, according to the most recent on-chain data. This increase significantly alters short-term market conditions and increases the likelihood of further downside volatility.
Shiba Inu remains stuck
Technically speaking, SHIB is still stuck in a recurring downward trend. The fact that price action is still trading below significant moving averages, such as the 26 EMA and the longer-term trend indicators, indicates that bearish control has not yet eroded.
Smaller consolidation structures have frequently been formed in attempts to stabilize, but each breakout attempt has been unsuccessful due to a lack of momentum and low buyer conviction.
Another level of worry is raised by the spike in exchange inflows. Large inflows typically occur before stronger selling pressure because tokens moved to exchanges are instantly available for liquidation. With volumes pushing well above recent averages, the inflow chart clearly demonstrates an increase in activity.
This kind of action typically indicates repositioning as opposed to accumulation, implying that market players are getting ready for distribution as opposed to long-term holding.
Shiba Inu stays grounded
The behavior of prices supports that interpretation. While volume is still quite low in comparison to prior rallies, SHIB has been compressing within a narrow range close to local lows. The asset is exhibiting signs of exhaustion rather than a bullish expansion, and short-lived rebounds are swiftly absorbed by selling, preventing any significant structural change.
Because there is usually less liquidity on cryptocurrency markets on weekends, significant inflow-driven selling may result in exaggerated movements. Price swings could become more unpredictable and challenging to stabilize if sellers continue to be active while buying demand is kept low.
Rising exchange supply, poor technical positioning and a precarious market structure characterize Shiba Inu's current situation.
Although the spike in inflows does not always portend a precipitous drop, it unmistakably shifts the landscape in favor of a more challenging trading environment. The weekend session may prove more troublesome than many traders currently anticipate, unless inflows return to normal or robust demand arises to absorb the supply.
Dan Burgin
Vladislav Sopov
