Shiba Inu [SHIB] has been in a correction phase for the last 10 days as its market cap slid back below $3 billion. Despite the total market cap of all memecoins climbing by 2.68%, the daily trading volume was down 29% to around $2.03 billion.
Shiba Inu bulls test support, but bears stay focused
While there has been a broader crypto market resurgence over the past three months, the recovery of the top memecoins has been shallow.
For instance, Shiba Inu surged from a low of around $0.00000410 to a three-month high of $0.00000627. This represented a hike of more than 53%. However, it has since declined by 19%.
At the time of writing, the bears were testing the strength of bulls to keep SHIB above the slanting support for the fourth time. Similarly, other top memecoins like Dogecoin [DOGE] were at a demand zone at $0.08, hinting that the sector movement may be in sync.
The bulls seemed to be defending this level, evident from the long tail formed on 15th October daily candle. If $0.0000050 holds, then there is a chance it will bounce back above $0.0000060.
However, the momentum indicators showed that bears were unmoved. The MACD bars were red, and 2.75 billion SHIB were sold as per the CVD.
SHIB’s hourly burn rate explodes
As bulls and bears battle for control, signals from both divides appeared to be present. For instance, the hourly burn rate surged by 100% with 61.45 million SHIB permanently removed in circulation in just one transaction.
However, the rate had reduced by 59% when viewed on a weekly scale. Over the past seven days, 160.5 million tokens have been burned. And yet, despite this routine supply crunch, SHIB’s price action has not been reflecting it.
So, why is the price still declining?
As it stands, the memecoin is still struggling on the charts. The Exchange Withdrawing Transactions metric seemed to be declining at press time, indicating that there were no capital inflows into SHIB.
These transactions fell from 522 to 100, a 5x decline in just two days.
Additionally, its daily trading volume was minimal compared to its peers, accounting for $41.25 million. On the other hand, DOGE, PEPE, and Official Trump [TRUMP] had $715 million, $146 million, and $234 million, respectively.
With a decline in memecoin trading activity, especially for SHIB, it may lose its slanting support. Otherwise, a hold above $0.000005 accompanied by a sector resurgence would help bulls outweigh bears at the level.
Final Summary
- Shiba Inu bulls are under tough test at $0.000005 support.
- SHIB is seeing mixed bullish and bearish signals as token burns surge despite declining capital injection.
