The Shiba Inu (SHIB) price downtrend is expected to extend beyond the current 30% as the meme coin is losing the backup it had gained over the past few weeks.
The likely outcome is another 20% plunge on the daily chart, but if SHIB bounces back from a crucial support level, it could recover.
Shiba Inu Price Fall Continues
Shiba Inu price is trading at $0.00002542 at the time of writing, after the meme coin failed to reclaim the support of $0.00002800. The increasing bearishness is due to the broader market bearish cues triggered by the decline in Bitcoin price.
SHIB investors are likely going to extend this decline not by doing something but by actually not doing anything. The minimal activity from Shiba Inu holders is a crucial reason for the lack of support for price action.
New investors are completely pulling away from the second-biggest meme token in the world, as evidenced by the network growth. This metric is used to measure the traction of an asset, essentially the rate at which new addresses are created. A decline in the same suggests Shiba Inu is losing traction with every passing day.
Shiba Inu Network Growth. Source: Santiment
Secondly, a chunk of the supply just moved into the hands of short-term holders. These holders tend to hold their assets for less than a month, making them vulnerable to sudden selling. Over the past four days, more than 23 trillion SHIB worth $582 million moved into these wallets, increasing the potential of corrections due to profit-taking.
Shiba Inu Supply Distribution. Source: IntoTheBlock
SHIB Price Prediction: Another Day, Another Dip
By the looks of it, Shiba Inu’s price will likely witness a decline to $0.00002268, a level tested as both resistance and support in the past. But much stronger support lies at $0.00002039, as this price coincides with the 100-day EMA.
Chances of Shiba Inu price correction halting are likely at this level, which would mark a 20% correction.
SHIB/USDT 1-day chart. Source: TradingView
On the other hand, the 100-day EMA could act as the support level from where SHIB bounces back. If the meme coin changes the direction in which the price moves from this point, it could climb back toward the resistance at $0.00002835. Breaching this would invalidate the bearish thesis.
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