The Shiba Inu Coin price was flat on Monday, Dec. 22, and hovered near its lowest level since October 2023.
Summary
- Shiba Inu price has formed a large falling wedge chart pattern on the daily chart.
- The token’s burn rate jumped by 133% on Monday to 7.2 million.
- The supply of SHIB tokens has continued to fall over the past few months.
Shiba Inu (SHIB), the second-biggest meme coin in the crypto industry, was trading at $0.0000073, down by nearly 80% from its highest point in 2024.
SHIB token has dropped recently despite having some notable catalysts. For example, data shows that its burn rate has jumped in the past few days, continuing the process of removing tokens from circulation.
The network incinerated over 7.2 million tokens in the last 24 hours, a 133% jump from the previous day. It has burned more than 35 million tokens over the past four days, bringing the circulating supply to 585 trillion.
The ongoing increase in Shiba Inu burn rate coincided with a decline in exchange supply. Data compiled by Nansen, a top analytics platform, shows that the supply has been in a freefall over the past few months and is now at the lowest level in months.
The declining number of tokens on exchanges indicates that investors continue to move their coins to cold storage. Investors mostly move their tokens in cold storage when they expect a token to rebound.
However, Shiba Inu faces some significant challenges that may affect its rebound. One of them is that Shibarium, its layer-2 network, has failed to gain momentum. It has not added any new protocols recently, while the total value locked has dropped by 19% to $1.47 million.
The other main risk is that Shiba Inu’s daily volume and investor demand have fallen in the past few months; its daily volume has risen to $96 million, and its futures open interest has declined to $77 million, down from the year-to-date high of $550 million.
Shiba Inu Coin price technical analysis
The daily timeframe chart shows that the SHIB price has been in a strong downward trend this year. It has continued to form a series of lower lows and lower highs, indicating that each rebound encountered substantial resistance.
Shiba Inu token has formed a falling wedge pattern, which is made up of two descending and converging trendlines that are about to converge.
The Percentage Price Oscillator has also formed a bullish divergence pattern, which occurs when an oscillator rises while an asset declines.
Therefore, the token will likely rebound in the near term, with the next target being the psychological level of $0.000010. On the other hand, a drop below the year-to-date low of $0.0000069 will invalidate the bullish outlook.
