Shiba Inu Burn Rate Dips: Can Its Price Recover by 90%?
The recent sell-off in the cryptocurrency market has not spared Shiba Inu (SHIB), with its price dropping by 21% from its highest level this month. However, despite the decline in the burn rate, which fell by 30% on November 26 to 3.4 million, there are still reasons to believe that SHIB’s price could recover by 90% to reach its year-to-date high of $0.000045.
Understanding the Burn Rate
The burn rate of SHIB refers to the number of coins that are being removed from circulation and destroyed. According to Shiburn, a website that tracks SHIB burn data, the total number of burned coins has reached 410 trillion. This trend is expected to continue in the coming years, with Shibarium and ShibaSwap transaction fees driving the burn process.
Shibarium, a layer-2 network, has seen a decrease in daily fees despite an increase in transactions. Fees on November 25 stood at 714 BONE, equivalent to $342, with some of these coins converted to SHIB and burned. ShibaSwap, a decentralized exchange on Shibarium, has over $23.2 million in total assets, with total annualized fees reaching $2.4 million.
Whales Selling SHIB
The decline in SHIB’s price can also be attributed to whales selling the coin, likely taking profits after the recent rally. The largest whale transaction on November 26 involved selling tokens worth $4.8 million, while two other whales sold tokens worth $2.2 million and $1.8 million, respectively.
Technical Indicators Suggest a 90% Price Recovery
Despite the decline in the burn rate and whales selling SHIB, technical indicators suggest that the coin’s price could rise by 90% to reach its year-to-date high of $0.000045. On the daily chart, SHIB has formed a cup and handle pattern, a bullish indicator. The upper boundary of this pattern is at $0.000029. By measuring the depth of the cup, projections indicate that the coin could rise to $0.000046, approximately 94% above its current level.
Shiba Inu has also developed a bullish pennant pattern, characterized by a vertical line and a symmetrical triangle. Typically, this pattern leads to a bullish breakout when the triangle nears its confluence point. Additionally, SHIB recently formed a golden cross pattern, where the 200-day and 50-day moving averages intersect. These indicators suggest that the bullish trend remains intact, and the coin may soon retest its year-to-date high.
Conclusion
While the decline in the burn rate and whales selling SHIB may seem like a negative trend, technical indicators suggest that the coin’s price could recover by 90% to reach its year-to-date high of $0.000045. The cup and handle pattern, bullish pennant pattern, and golden cross pattern all point to a bullish trend, and investors may want to consider taking advantage of this opportunity.
Key Takeaways
- The burn rate of SHIB has declined by 30% on November 26 to 3.4 million.
- Technical indicators suggest that SHIB’s price could rise by 90% to reach its year-to-date high of $0.000045.
- The cup and handle pattern, bullish pennant pattern, and golden cross pattern all point to a bullish trend.
- Investors may want to consider taking advantage of this opportunity to buy SHIB at its current price.
Recommendation
Based on the analysis, I recommend that investors consider buying SHIB at its current price, with a target price of $0.000045. However, as with any investment, it’s essential to do your own research and consider your own risk tolerance before making a decision.