Further Pullback or Recovery Coming Next?

TL;DR

• A major increase in Shiba Inu’s burn rate and rising transactions on Shibarium hint at potential upward price movement for the meme coin.
• One analyst notes a bullish flag pattern, suggesting SHIB could gain up to 90% if it clears $0.00001884.

The Next Potential Direction for SHIB

The cryptocurrency sector witnessed a substantial pullback in the past 24 hours, with its global market capitalization plummeting by over $100 billion. Bitcoin (BTC), which traded above $72,500 on October 31, is now worth approximately $69,000, whereas Ethereum (ETH) dipped below $2.5K. 

The popular meme coin Shiba Inu (SHIB) is also among the biggest losers. Its price fell by 7% on a daily scale, while its market cap tumbled back to $10 billion.

The current situation in the meme coin realm is not looking great, with Dogecoin (DOGE), dogwifhat (WIF), and many others crashing by double digits. This negative trend might result in further downward pressure on SHIB’s price in the short term. 

However, two important factors suggest that the asset’s valuation may head north soon. The first is the SHIB burn rate, which has skyrocketed by a whopping 252,900% in the last 24 hours, resulting in more than 5.6 billion tokens sent to a null address. Calculated at current rates, the destroyed stash equals approximately $100,000.

It is worth noting that the cat-themed meme coin project Shiro Neko burned almost 100% of the aforementioned amount. Shiba Inu’s team acknowledged the initiative, describing it as “a historic moment for our community.”

Burning SHIB tokens reduces the meme coin’s circulating supply. This leads to scarcity and could potentially boost its price (assuming demand doesn’t decline). 

The second bullish element is the resurgence of Shiba Inu’s layer-2 scaling solution – Shibarium. Data shows that transactions processed on the protocol on October 31 reached almost 4 million (a 130% increase compared to the figure observed the day before). For more updates on the ecosystem, check out our Shibarium news page.

This revival signifies robust network engagement, which can positively influence SHIB’s price through increased utility and improved market sentiment. 

90% Rally Incoming?

One industry participant focusing on SHIB’s future movements is the X user Clifton Fx. The analyst noted the emergence of a “bullish flag formation” on the asset’s three-day price chart, speculating that the valuation could skyrocket by nearly 90% if it reclaims $0.00001884.

$SHIB (Update)

Bullish Flag Formation in 3d Timeframe…

In Case of Upside Breakout We Can See a 80 – 90% Bullish Rally#SHIBUSDT #SHIB #Crypto pic.twitter.com/aELvv9eNc0

— Clifton Fx (@clifton_ideas) October 31, 2024

SHIB currently trades at around $0.0000173 (per CoinGecko’s data), meaning it needs to advance by 9% to reach the depicted target.