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Although Shiba Inu is still struggling close to critical support, new on-chain data indicates a startling change in the market’s dynamics. After breaking below its symmetrical triangle pattern, the price is currently hovering at $0.00001224, but exchange flows show that selling pressure is still noticeably lacking.
Sellers not ready?
Within a 24-hour period, SHIB experienced an astounding 485.6 billion SHIB in exchange net outflows, according to CryptoQuant. In other words, rather than being deposited for sale, almost half a trillion tokens were removed from centralized exchanges. This implies that both retail and whale holders are moving their tokens into self-custody, thereby lowering the immediate risk of significant liquidations. Such outflows typically tighten the supply available on trading platforms and serve as a bullish indicator.
The technical architecture of SHIB, however, is weak. The asset is currently hovering near oversold territory at 41.99 after breaking below the triangle support and showing weak momentum on the Relative Strength Index (RSI). Additionally, there has been no significant support from the 50, 100 and 200-day moving averages, suggesting that the overall downward trend is still in place.
Exchange flows are suspicious
The resulting paradox is that exchange flows indicate a different picture than price action, which suggests weakness and a possible continuation toward 2025 lows. In spite of the unfavorable chart structure, holders appear unwilling to give up their positions. With fewer tokens easily accessible on exchanges, it increases the risk of a supply squeeze in the event that demand resurfaces without warning.
Looking ahead, SHIB is still at a turning point. The lack of exchange supply may increase upward volatility if demand even slightly increases. Notwithstanding the robust outflow data, the token might find it difficult to recover if general market sentiment stays pessimistic, especially in light of the corrections that Ethereum and Bitcoin are experiencing.
Generally, market participants are showing some upside potential on the SHIB market, but whether or not this patience results in a recovery will depend on outside demand. One thing is clear for the time being: nobody is selling.
Dan Burgin
Vladislav Sopov
U.Today Editorial Team