Shiba Inu Weakens Below Key Averages, Death Cross Incoming

Shiba Inu (SHIB) is under intense bearish pressure as the cryptocurrency market continues to weaken further. The token currently trades at approximately $0.00001123 USDT, but more critically, it remains stuck beneath three significant moving averages: the 50 EMA, 100 EMA, and 200 EMA on the hourly chart. This alignment of resistance levels is a classic indicator of continued downward momentum.

Death Cross Formation Signals Trouble Ahead

Technical indicators show SHIB is on the verge of forming a death cross a bearish chart pattern that occurs when the 50-day exponential moving average (EMA) crosses below the 200-day EMA. Traders closely monitor this pattern as it often marks the beginning of steep sell-offs. If confirmed, this signal could trigger a fresh wave of selling, primarily as automated trading systems activate stop-losses and sentiment deteriorates further.

_{SHIB/USDT Source: Tradingview}

In addition to bearish chart signals, on-chain data underscores the token’s fragile condition. Around 67% of SHIB holders are currently in the red, a metric that often precedes panic selling. Furthermore, the volume of large transactions over the past week has dropped to $105.5 million and continues to trend downward, indicating declining interest from major holders, also known as “whales.”

Moreover, key metrics such as net network growth, participation in large transactions, and address concentration are all flashing red. Out of six core indicators used to gauge sentiment, four now reflect a “mostly bearish” outlook.

Retail Interest and Community Support Dwindle

Retail enthusiasm appears to be fading as well. Telegram group membership, often a proxy for community engagement in meme tokens, declined by 0.39% this past week. This decline further weakens SHIB’s support base, which has traditionally relied heavily on community-driven momentum.

Shiba Inu’s price chart, on-chain activity, and community engagement all indicate a downward trend. The potential confirmation of a death cross could mark the start of a more pronounced bearish phase. Combined with weakening whale participation and reduced retail interest, the probability of SHIB testing or even breaking recent lows remains high. Investors should proceed with caution, as volatility is looming.

Disclaimer: The information in this article should not be considered financial advice, and FXCryptoNews articles are intended only to provide educational and general information. Please consult with a financial advisor before making any investment decisions.