Shiba Inu’s Bull Run: Is a Bearish Turnaround Inevitable?

Shiba Inu (SHIB) has been on a tear, hasn’t it? It feels like just yesterday we were talking about its last peak, and now it’s surged to a fresh three-month high, hitting $0.0000106! That’s quite a jump, even outperforming its August 5th high. But in the crypto world, what goes up must eventually… well, you know. As SHIB’s buzz grows, so does the whisper of a potential market pullback. So, what’s the story as we head into the weekend? Let’s dive in.

Is the Bullish Momentum Fading? Spotting Bearish Signals

Remember the Relative Strength Index (RSI)? It’s like a speedometer for price momentum. While SHIB’s RSI was flashing ‘overbought’ on August 5th, this time it’s noticeably lower despite the higher price. Interesting, right? This difference between price and RSI – what we call a price-RSI divergence – can sometimes signal that the bullish energy might be losing steam. Think of it like a car struggling to accelerate even with the pedal to the metal.

Adding to this, SHIB has now climbed above its 200-day moving average, a key indicator many traders watch. And guess what? The RSI is creeping back towards overbought territory. Could this be a double warning sign?

Then there’s @ali_charts, a well-known analyst on social media, who’s spotted a TD sequential pattern forming on SHIB’s price chart. This pattern is often seen as a sign of trend exhaustion, suggesting a possible reversal. When you combine this with the price-RSI divergence, the possibility of a bearish shift for SHIB starts to look more plausible.

What Are the Whales Doing? Decoding On-Chain Data

To really understand what’s happening, we need to look under the hood at SHIB’s on-chain data. One crucial aspect is tracking the big players – the whales. Their moves can often foreshadow market shifts. So, what are they up to?

• A bearish retracement often involves increased selling pressure from these large holders.
• Looking at SHIB’s supply distribution, we see heightened selling activity from addresses holding between 1 million and 100 million SHIB. These are highlighted in red and orange on some analytics platforms.
• We’ve observed outflows from these addresses over the last four days. This suggests some whales are taking profits off the table.
• However, it’s important to keep perspective: these addresses collectively hold less than 4% of SHIB’s total circulating supply.

Who Really Holds the Power? The Dominance of Major Holders

Here’s a surprising statistic: addresses holding over 1 billion SHIB coins control a whopping 96.53% of the total supply! And here’s the kicker – these mega-holders have remained stable, showing no signs of selling off yet. This is a crucial point to consider. Are they waiting for an even higher price? Or are they unfazed by the recent volatility?

Is Activity Picking Up? Analyzing Transaction Volume

Beyond the whales, let’s look at the overall activity. What do the transaction counts and trading volumes tell us?

• SHIB’s transaction count has been consistently increasing over the past four days. More transactions generally mean more activity.
• We’ve also seen a modest rise in trading volume during the same period.

While increased activity can be a sign of a healthy market, it can also indicate building selling pressure, especially when other indicators suggest a weakening bullish stance. It’s like a busy exit ramp – lots of movement, but everyone’s heading in one direction.

Putting It All Together: Is SHIB Poised for a Pullback?

So, what’s the bottom line? Shiba Inu’s recent bullish run is facing some headwinds. The price-RSI divergence and the emergence of a TD sequential pattern suggest that the upward momentum might be waning. While a segment of whale addresses is indeed selling, the vast majority of SHIB is held by larger entities who haven’t moved their holdings – yet.

However, the increased transaction counts and trading volume could be early signs of a broader shift towards bearish sentiment. It’s a complex picture, with conflicting signals. As the weekend unfolds, keeping a close eye on these indicators will be crucial for anyone tracking SHIB’s journey. Will the major holders start to sell? Will the bearish signals strengthen? Only time will tell.

For investors and enthusiasts, the key takeaway is to stay informed and be prepared for potential volatility. The crypto market is known for its rapid shifts, and SHIB is no exception. Monitor those charts, watch the on-chain data, and remember – in the world of crypto, nothing is ever truly certain.