This Shiba Inu (SHIB) Metric Drops to a Multi-Month Low: More Pain Ahead?

TL;DR

• One Shibarium indicator has plummeted substantially, suggesting that Shiba Inu’s price may continue dropping.
• On the other hand, some analysts expect a major resurgence in the near future, while the RSI nears oversold levels. 

Headed for a Further Decline?

The second-largest meme coin has been in a downtrend for the past month, and the latest correction in the crypto market has only intensified its condition. Currently, it trades at around $0.00001239 (according to CoinGecko’s data), representing a steep decline from the local peak of $0.00003086 reached in December 2024. 

Moreover, several key factors suggest that Shiba Inu (SHIB) may be poised for an additional pullback. The number of transactions processed on the layer-2 scaling solution Shibarium fell to almost one million on August 24, or its lowest point since the beginning of June. 

This showcases reduced activity on the network, which could mean low interest in the entire ecosystem. Additionally, each transaction on Shibarium involves burning SHIB, which could potentially boost the price if demand remains stable or goes up. Over the past 24 hours, the burn rate has risen by a mere 1.2%, resulting in approximately 3.7 million tokens, whose USD valuation is insignificant. 

The SHIB exchange netflow in the last few days supports the bearish outlook. Recently, inflows have surpassed outflows, indicating that investors are shifting from self-custody to centralized platforms, which in turn increases immediate selling pressure. 

SHIB Exchange Netflow, Source: CryptoQuant

The Chances of Resurgence

Contrary to the bearish elements outlined above, some analysts continue to project bullish scenarios for the meme coin.

One popular X user claimed SHIB is still ranging inside its accumulation zone, noting that major rallies have historically followed such consolidations. The analyst set two targets, with the first being $0.00005589 and the second $0.00003296 (which would represent a 166% pump from the current levels).

SHIB’s Relative Strength Index (RSI) also suggests an incoming rebound. The technical analysis tool measures the speed and magnitude of the latest price changes to help traders spot possible reversal points.

Readings around and below 30 usually indicate that the asset is in an oversold zone and could be due for a resurgence, while anything above 70 is considered bearish territory. The RSI has been gradually declining in the past few days and is heading toward the bullish mark.