Shiba Inu (SHIB) Whales Activity Surges, But 36% Price Rally Unlikely

Shiba Inu (SHIB) whales have dramatically increased their transactions over the past few days, sparking hopes of a potential price rally. However, despite the surge in whale activity, market analysts warn that the anticipated 36% boost in the meme coin’s value may not materialise as expected. A mix of bearish market sentiment and concerning technical indicators has cast doubt on whether Shiba Inu (SHIB) whales will succeed in their efforts to drive the price higher.

Shiba Inu (SHIB) Whales Swing Into Action

Over the weekend, Shiba Inu (SHIB) whales made significant moves in the market, with large transactions surging by a staggering 406%. According to data from IntoTheBlock, whale transactions—defined as transfers exceeding $100,000—jumped from 395 billion SHIB on Sunday to 2.51 trillion SHIB by Tuesday. In monetary terms, this equates to a leap from $5.31 million to $33.41 million, illustrating the intensity of whale activity.

Such a dramatic increase in whale activity indicates that major investors are taking advantage of Shiba Inu’s currently undervalued position. Since reaching its peak price of $0.000016 on August 24, SHIB has dropped 19%, making it an attractive buy for investors looking to profit from a potential rebound.

Undervalued, But for How Long?

The undervaluation of Shiba Inu is supported by its market value to realised value (MVRV) ratio, which has turned negative. Currently, SHIB’s 30-day and 90-day MVRV ratios stand at -2.70 and -13.24, respectively. This indicates that the coin is trading below the average price at which most tokens were last transacted, making it a prime opportunity for those looking to “buy the dip.”

In the world of crypto, a negative MVRV ratio is often considered a buy signal. However, despite these bullish indicators, Shiba Inu (SHIB) whales could face serious headwinds in their attempt to trigger a 36% price increase.

Bearish Indicators Signal Trouble Ahead

Although Shiba Inu (SHIB) whales have been busy accumulating the coin, market sentiment around SHIB remains predominantly bearish. Technical indicators such as the Elder-Ray Index (ERI) and Directional Movement Indicator (DMI) suggest that selling pressure continues to dominate.

The Elder-Ray Index, a key metric for measuring the balance between buying and selling pressures, has remained in negative territory since Monday. This indicates that sellers are currently in control, and buying momentum has yet to pick up. As long as the ERI remains negative, Shiba Inu’s price is unlikely to experience a significant rebound.

Similarly, the Directional Movement Indicator (DMI) paints a worrying picture for Shiba Inu (SHIB) whales. The negative directional indicator (represented by the red line) is sitting above the positive directional indicator (blue line), suggesting that selling pressure is stronger than buying demand. If this trend continues, SHIB’s price could decline further, even as whales continue to accumulate the meme coin.

Analyst Predictions: The 36% Price Rally in Jeopardy

Market experts are cautious about predicting any near-term recovery for Shiba Inu. “The technical indicators do not inspire confidence for an immediate bounce,” said Mike McGlone, Senior Commodity Strategist at Bloomberg Intelligence. “Although whale activity has surged, the broader market sentiment remains bearish, and SHIB could face more downside unless we see a significant uptick in buyer interest.”

If selling pressure remains dominant, Shiba Inu could potentially revisit its August 5 low of $0.000010. For Shiba Inu (SHIB) whales, this would represent a significant setback, as many have been banking on a recovery to the resistance level of $0.000018—a 36% increase from current levels. However, without stronger buying demand, this target may remain out of reach.

Long-Term Outlook: Is There Hope for Shiba Inu?

While the short-term outlook for Shiba Inu appears grim, some analysts believe the coin still has long-term potential, especially if broader market conditions improve.

James Butterfill, Head of Research at CoinShares, noted, “Shiba Inu has a strong community of holders and significant retail interest, which could act as a buffer against prolonged declines. But whales alone won’t be able to push the price up in the current environment—retail and institutional investors need to step in.”

In the meantime, Shiba Inu (SHIB) whales appear to be playing the waiting game, continuing to accumulate while hoping for a change in market sentiment. However, with bearish technical indicators and weak buying momentum, their attempt to drive SHIB’s value up by 36% remains uncertain at best.

Can Whales Change the Tide?

Despite the optimism surrounding the surge in whale transactions, Shiba Inu’s (SHIB) near-term prospects remain unclear. While the negative MVRV ratio presents an attractive buying opportunity for Shiba Inu (SHIB) whales, the broader market dynamics are currently stacked against them. Without a significant shift in sentiment, the much-anticipated 36% price rally could be delayed or derailed altogether.

As Shiba Inu (SHIB) whales continue to accumulate, only time will tell if their strategy pays off. For now, cautious optimism seems to be the prevailing mood among market analysts, with many advising patience as the meme coin navigates the turbulent waters of 2024’s crypto market.