Will Shiba Inu (SHIB) Add Another Zero? Analyzing the Recent Crash

Shiba Inu (SHIB) recently experienced a sharp decline, dropping almost 20% in just a week. The meme coin’s price plunged from approximately $0.00017 to $0.00001339, marking a significant drop from its mid-July high of $0.00002. This steep decline has raised concerns among investors about SHIB’s future, as it fell to a five-month low of $0.00001088 in the last 24 hours.

SHIB Reflects Broader Market Downtrend

*SHIB Price Action. Source| TradingView*

SHIB’s price movement closely follows the broader cryptocurrency market’s bearish trend. This trend has been characterized by widespread liquidations and prevailing negative sentiment. SHIB breached critical support levels, confirming a downward trajectory. Since its peak earlier this year, the meme coin has declined by almost 70%, underscoring the severity of its downturn.

On-Chain Metrics and Investor Behavior

Despite previous bullish predictions, SHIB now hovers near the crucial $0.00001 support level. Breaching this support could trigger further declines, potentially adding another zero to SHIB’s price. On-chain metrics reveal additional signs of bearish market conditions. A surge in SHIB’s trading volume before the price drop, coupled with a substantial outflow of funds, indicates weakening investor confidence and a possible exodus of holders.

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A significant portion of SHIB’s supply remains concentrated in a small number of wallets, with 73% held by large holders. However, overall market sentiment remains predominantly negative. Although 45% of holders are still in profitable positions, the prevailing bearish conditions and weak buying pressure challenge SHIB’s chances of a price recovery.

Is a Recovery Possible?

Despite the bleak outlook, a price rebound remains possible. Stabilizing market conditions and renewed investor interest could drive a recovery. However, such a turnaround would require a significant shift in market sentiment and a large influx of new investments. Some experts remain optimistic, with a crypto trader recently setting a $0.05 target for SHIB by the end of 2024. This target suggests an imminent recovery and a subsequent surge, despite SHIB’s current struggles.

In summary, while SHIB faces significant challenges, the possibility of recovery remains. This potential recovery hinges on broader market changes and renewed investor confidence.

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.