Shiba Inu (SHIB) has surged by 8.71% in the last 24 hours, reaching $0.00001009 and attracting significant attention. However, on-chain data reveals that this price spike lacks sustainable strength. According to the on-chain analysis platform CryptoQuant, SHIB’s net inflow into exchanges rose to 146 billion tokens, registering a 2.2% increase. This indicates that investors are transferring their assets to exchanges, signaling a potential rise in selling pressure.
Whales Initiating Profit-Taking?
Despite the technical upward trend, this uptick paints a rather negative picture. Investors generally send their tokens to exchanges intending to sell, suggesting that despite the price increment, the increase in exchange flow reflects weak investor confidence.
CryptoQuant’s data further shows that SHIB’s net outflow from all exchanges has climbed to 435 billion tokens. This suggests that large investors, or “whales,” might be selling to secure short-term profits. The recent recovery in SHIB’s price may have presented some investors with an opportunity to offset their losses.
Historically, such fluctuations in exchange inflows and outflows are amongst the leading indicators of price corrections. Experts assert that a decrease in on-chain activity might signify that investors are entering a profit realization phase, and the prevailing market activity may only represent a short-lived upswing.
Similar Patterns in Other Meme Coins
The scenario with Shiba Inu resembles the fluctuations observed in the broader “meme coin” market. For instance, Dogecoin (DOGE) recently experienced a 5% surge following posts by Elon Musk on his platform X but subsequently erased those gains. Experts suggest that such abrupt movements indicate that short-term investors are chasing speculative gains, potentially disrupting long-term stability.
Moreover, other notable meme coins like Pepe (PEPE) and Bonk (BONK) have exhibited high volatility in recent weeks. Investors’ inclination towards these coins reveals a heightened market risk appetite, but it also emphasizes the increased risk of sudden declines.
In conclusion, while the rise in Shiba Inu’s price has offered investors short-term gains, on-chain data underscores the fragility of this rally. The increased exchange flows signal a preparedness for potential pullbacks among investors. Whales leaning towards profit-taking could abruptly terminate the upward trend. Therefore, SHIB investors are urged to monitor on-chain data closely, instead of getting swept away by short-term price increases.