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Shiba Inu (SHIB) is witnessing a significant shift in its market dynamics, as its supply on exchanges has dropped to the lowest level since April 2021. This decline, despite the token’s lackluster price performance throughout the year, suggests a potential turning point for the popular meme coin.
SHIB Exchange Supply Hits a Multi-Year Low
At the beginning of 2024, SHIB’s exchange supply stood at a staggering 141.26 trillion tokens. A high exchange supply often signals a lack of confidence among investors, as it indicates that holders are preparing to sell their assets. However, SHIB’s exchange supply has since plummeted to 106.96 trillion, marking a significant drop. This suggests that investors are pulling their holdings off exchanges, typically a bullish sign that selling pressure is fading.
While this has not yet resulted in a strong price rally, the reduced supply on exchanges could be a catalyst for an impending breakout.
Key Support and Resistance Levels for SHIB
On-chain data from IntoTheBlock reinforces the bullish outlook. The In/Out of Money Around Price (IOMAP) metric highlights strong support for SHIB at $0.000012, where 23,200 addresses collectively hold over 19 trillion tokens. This outweighs the major resistance at $0.000015, where 10,680 addresses hold 12 trillion SHIB in unrealized losses.
Given this data, SHIB’s price is more likely to break above $0.000015 in the short term, potentially reaching new monthly highs.
Technical Indicators Signal a Potential Uptrend
The 4-hour chart further supports the possibility of a price reversal. The Moving Average Convergence Divergence (MACD) has turned positive, indicating growing bullish momentum. Additionally, the 12-day Exponential Moving Average (EMA) has crossed above the 26-day EMA, a classic indicator of a potential uptrend.
If these bullish signals hold, SHIB could target the 0.618 Fibonacci level at $0.000017. A surge in demand could even push the price to $0.000020. However, a bearish scenario could see SHIB retracing to $0.000011.
With SHIB’s exchange supply at a multi-year low and key technical indicators aligning for an uptrend, the meme coin could be on the verge of a significant price move. While broader market conditions will play a role, the fading selling pressure could pave the way for a bullish breakout.
Disclaimer: The information in this article is for general purposes only and does not constitute financial advice. The author’s views are personal and may not reflect the views of Chain Affairs. Before making any investment decisions, you should always conduct your own research. Chain Affairs is not responsible for any financial losses.
Also Read: Shiba Inu Burns 20M SHIB: Can Token Burns Fuel a Price Rebound?
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