Shiba Inu (SHIB), a popular meme coin, has seen its destruction rate rise sharply in recent days, sparking speculation that its price could recover. The development comes amid a general decline in SHIB’s price, which has seen its value decline in recent weeks.
SHIB’s price has been trending downwards, falling below the $0.00002 range, and has dropped 10.66% in the past 24 hours. This drop has taken it down 19.72% on the week and 28.39% in the past month, with the current price at $0.00001758, according to CoinMarketCap.
Potential rebound signal
Despite the recent price plunge, there are two factors that suggest SHIB could be on the verge of a turnaround. The first factor comes from technical analysis by renowned chartist Ali Martinez.
Martinez used the TD sequential indicator to identify a buy signal on the daily chart of SHIB. Traders often use this indicator to identify buying opportunities. It may also signal a reversal of the current downtrend.
Burn rate soars
The second factor is the massive increase in the SHIB burn rate. In the past 24 hours, the burn rate initially spiked by a staggering 12,842%. This means that a large number of SHIB tokens were destroyed, totaling 12,047,795 (12.04 million) SHIB.
The burn rate has dropped to 24.04%, with 12.9 million SHIB tokens destroyed in the past 24 hours.
Burning tokens removes them from circulation, which could result in a decrease in the total supply of SHIB. In theory, this deflationary mechanism could support future price increases by reducing the number of tokens available for trading.
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Market volatility and due diligence
While the spike in burn rates and Martinez’s analysis suggest that SHIB prices could rebound, it’s crucial to acknowledge the inherent volatility of the cryptocurrency market.
Accurately predicting the future performance of any cryptocurrency, especially an emerging asset like SHIB, remains a challenge. Therefore, it is crucial to conduct thorough research before making any investment decisions.
The coming days and weeks will be critical for SHIB. Investors and analysts will be watching closely to see whether the recent increase in the burn rate and potential buying signals translate into a sustained price recovery.