Shiba Inu (SHIB) experiences a notable surge, but a decrease in whale activity raises questions about the sustainability of this rally.
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SHIB broke out of a descending channel while Open Interest surged 130%.
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Whale Netflows dropped 116.67% over seven days, indicating reduced activity or caution among large holders.
Shiba Inu [SHIB] ignited fresh excitement in the market after its 24-hour burn rate soared by an eye-popping 8925.23%. Such a move reflects the SHIB community’s intensified effort to reduce the circulating supply, potentially creating a deflationary push.
Historically, aggressive burn activity has often preceded upward price movements. While this doesn’t guarantee a rally, it sends a strong signal of growing engagement and support for price appreciation as SHIB eyes a sustained recovery phase.
Is SHIB breaking free from its downtrend grip?
On the 4-hour chart, SHIB has broken out of a descending channel pattern, a structure it respected for several weeks. This move above the upper trendline places SHIB at $0.0000153 and signals renewed bullish pressure. The Alligator Indicator flipped green as the moving averages diverged upward, reinforcing early signs of trend reversal. However, SHIB must hold this breakout to avoid slipping back into consolidation.
Source: TradingView
Is leveraged trading the real driver behind SHIB’s surge?
Speculative appetite exploded as Open Interest surged 130.24% to $225.81 million, indicating that traders are significantly positioning for a price move. Additionally, SHIB’s Funding Rate flipped positive at 0.0127%, reflecting increasing confidence among long traders willing to pay a premium to maintain their positions. However, rising Open Interest can also increase the risk of volatility, especially if long positions become overcrowded without strong spot support.
Source: CoinGlass
Does SHIB remain undervalued based on MVRV data?
According to Santiment data, SHIB’s MVRV Z-Score remained deep in negative territory at -2.13. This suggests that the asset is still trading below its fair value when compared to historical averages. A low Z-score often implies that holders are sitting on unrealized losses, reducing the incentive to sell. As a result, there might be less profit-taking pressure even if prices rise in the short term, allowing SHIB room to grow without facing immediate overhead resistance from holders exiting at breakeven.
Source: Santiment
Why are whales suddenly pulling back from SHIB?
One red flag is whale behavior. Large Holder Netflow dropped 116.67% in the past 7 days, according to IntoTheBlock data. This downturn indicates that whales are reducing their inflows or offloading positions, potentially reflecting caution as smart money evaluates the current rally’s strength. Historically, whale accumulation aligns with strong uptrends.
Source: IntoTheBlock
SHIB has shown strong bullish signals, including a breakout above resistance, rising leverage, and a record burn rate. However, the drop in large holder activity introduces a layer of uncertainty. If retail momentum continues and technical indicators remain aligned, SHIB could extend its rally. Nevertheless, without renewed whale support, sustaining higher price levels may prove challenging.
Conclusion
In summary, Shiba Inu appears to be navigating a pivotal moment characterized by increased retail interest and leveraged trading. Nonetheless, the waning involvement from whale investors presents potential headwinds. Moving forward, closely monitoring these dynamics will be essential for understanding SHIB’s trajectory.
