TL;DR
Shiba Inu (SHIB) has dropped 13% in the past week, with analysts suggesting it could fall further soon but rally in the long term.
The poor performance of the L2 blockchain solution Shibarium, with declining transactions and accounts, may negatively affect SHIB’s price.
Where’s SHIB Headed Next?
The popular meme coin – Shiba Inu (SHIB) – has been underperforming in the past week, with its price tumbling by approximately 13% (per CoinGecko’s data). According to some industry participants, the downtrend might intensify in the short term.
One X user claimed that SHIB’s valuation remains in a “neutral zone” as long as it keeps trading in the $0.0000185-$0.0000164 range. However, the analyst assumed it could drop to $0.000015 if losing the major resistance level of $0.000017. Recall that the price briefly dipped below that level several hours ago.
“It’s difficult to define a direction for the long & mid-term, but zooming on the 3rd chart, I see a possible bearish triangle,” the trader added.
On the other hand, the analyst predicted that SHIB is poised to rally in the long term, but “it’s currently stuck in a pretty neutral zone,” making it a “difficult coin” to trade yet.
“I recommend you to wait for lower levels to be tested to enter into a long position. Sometimes, it’s better to observe than trade,” they concluded.
Other analysts have been more bullish, setting optimistic price targets for SHIB. In April, the X user Rekt Capital suggested that the meme coin’s valuation could skyrocket by triple digits should it exceed the resistance level of $0.000033285. It is worth noting that the last time SHIB traded that high was in March of this year.
Shibarium’s Downfall
Another factor hinting that SHIB’s price could continue to suffer in the days ahead is the poor performance of the layer-2 blockchain solution Shibarium.
The protocol processed only 2,310 daily transactions on July 23, representing an 83% decrease compared to the figure observed at the end of June. The number of active accounts, new contracts, and new verified contracts has also headed south.
The L2 scaling solution went live less than a year ago, aimed at handling more transactions per second, reducing congestion, and improving the overall network performance. As such, some industry participants believe its further progress could positively impact the SHIB price.
Shibarium underwent some important upgrades in the last several months, including the launch of a new user interface (UI) update. The development allows compatibility with popular self-custody wallets, including MetaMask, Coinbase Wallet, and Trust Wallet.
For more updates on the ecosystem, make sure to check out our Shibarium news.
The post Bad News for Shiba Inu Bulls? Here’s Why SHIB’s Price Might Plunge Soon appeared first on CryptoPotato.
