On August 4th, the cryptocurrency world witnessed a significant development in the Shiba Inu (SHIB) ecosystem as the Binance exchange announced the approval of SHIB and seven other altcoins as collateral assets. This move sparked renewed interest and activity in the SHIB market, resulting in a 12% surge in price, pushing it to a 3-month peak of $0.0000098. However, a critical on-chain indicator raises concerns about the sustainability of this price rally.
Following the Binance announcement, Shiba Inu trading volume experienced a revitalization. Prior to the approval, SHIB Tokens Transferred had declined by 66% from the previous week’s volume, but after the announcement, it rose by 41% to reach 4.1 trillion SHIB. Tokens Transferred, a measure of transactional activity on the blockchain network, is often considered a bullish indicator, signaling growing market demand for SHIB.
Potential Price Rally to $0.00001
With the surge in Tokens Transferred, market analysts are predicting a potential rally that could propel SHIB’s price to $0.00001 in the coming days. The positive sentiment is fueled by the excitement surrounding the Binance approval and the growing interest in Shiba Inu’s ecosystem.
While the Binance approval brought optimism to the market, some strategic traders have been taking advantage of the bullish sentiment to seek short-term profit opportunities. The Exchange On-chain Market Depth chart shows that bears have begun mounting sell-walls, with active orders to sell 1.5 trillion SHIB tokens, outpacing the 1.4 trillion SHIB purchase orders from buyers.
Potential Flash Price Correction
The presence of sell-walls raises concerns about a potential flash price correction. If the ongoing price rally hits a euphoric top, the bears could offload a large volume of SHIB tokens, leading to a price correction. To mitigate this risk, strategic investors are expected to apply conservative stop-loss measures to protect their positions.
Despite the positive sentiment, breaking above the $0.000011 resistance level might prove challenging for SHIB. IntoTheBlock’s IOMAP data indicates that 318,950 addresses hold 243 trillion SHIB tokens at this average price. If the resistance level is breached, SHIB could rally towards $0.000014. However, if it fails to overcome this obstacle, a price reversal could be triggered.
On the downside, bears will attempt to force a downswing below the $0.000008 support territory. The data suggests that 53,000 holders bought 28.4 trillion SHIB tokens at the minimum price of $0.000008, making this level a crucial support zone. If the price falls below this point, the next significant target will be the buy-wall at $0.000006.