Recent analysis shows that Shiba Inu’s (SHIB) recovery prospects are closely tied to the broader altcoin market, which has seen prices plunge for months.
However, if a consistent price increase occurs, the meme coin might also benefit from it. Here is how.
Shiba Inu Continues to Struggle with FUD
In March, Shiba Inu’s price surged to a yearly high of $0.000035, generating excitement as other altcoins saw similar gains. However, the meme coin’s value has since dropped by 65%.
In a report by Brian Quinlivan, Lead Analyst at Santiment, he noted that SHIB is unlikely to rally significantly unless altcoins recover from their extended downturn. Quinlivan also acknowledged that Bitcoin (BTC) could influence SHIB’s performance moving forward.
“The 30-day average trading returns are down just slightly at -1.1%, while the long-term returns are down a whopping -31.7%. This sets the 13th ranked memecoin up to potentially perform very well once Bitcoin can stabilize and altcoins are able to flourish again,” the analyst said.
While the hunt for a better price action continues, on-chain data shows that SHIB’s social dominance has been on a prolonged decline since May. Social dominance measures the rate of discussion around a cryptocurrency.
Read more: 6 Best Platforms To Buy Shiba Inu (SHIB) in 2024
Shiba Inu Social Dominance. Source: Santiment
An increase in this metric suggests strong market interest compared to other top 100 cryptocurrencies. The current decline, however, reflects growing Fear, Uncertainty, and Doubt (FUD) around SHIB.
Another indicator of FUD is the token distribution between retail and large investors. According to Santiment, SHIB holders with 100 to 1 million tokens have been accumulating.
In contrast, those holding between 100 million and 1 billion tokens have significantly reduced their positions. This difference between large investors and the retail crowd highlights the market’s uncertain sentiment.
Shiba Inu Balance of Addresses. Source: Santiment
If whales do not follow retail investors in accumulating SHIB, it could limit the token’s potential for the rest of the year.
SHIB Price Prediction: No 2021 Rally in 2024
An analysis of the weekly chart shows that SHIB appears to be mirroring a similar pattern from April 2022, when its price struggled to rise to $0.000027 after a sharp decline. Currently, SHIB is trading at $0.000013, and the Relative Strength Index (RSI) indicates weakening momentum, suggesting a lack of bullish sentiment around the token.
As a result, the token may find it difficult to replicate its May performance. SHIB could face resistance at around $0.000018 for the rest of the year, making it challenging to approach $0.000025.
Read more: Shiba Inu (SHIB) Price Prediction 2024/2025/2030
Shiba Inu Weekly Analysis. Source: TradingView
In the short term, SHIB’s price could fall below $0.000010. While there is a chance it could trade higher by the end of 2024, reaching $0.000025 seems unlikely unless an altcoin season materializes, which looks doubtful given the current market conditions.
* The content presented above, whether from a third party or not, is considered as general advice only. This article should not be construed as containing investment advice, investment recommendations, an offer of or solicitation for any transactions in financial instruments.
