Shiba Inu Coin Set for a 74% Crash as Whales Dump Holding—Rektober For SHIB?
NOIDA (CoinChapter.com) — Shiba Inu (SHIB) prices have shown bearish signals emerging from multiple fronts. While the meme coin still garners attention, there is no denying that the market sentiment is tilting toward the downside.
Whales have been offloading large portions of their SHIB holdings, which typically bodes ill for the price in the short term.
Whale Exodus Spells Trouble for SHIB
The whale activity surrounding SHIB suggests a significant shift in sentiment among large holders. Data reveals a sharp decline in the number of whale wallets holding between 10 million and 1 billion SHIB tokens.
The drop in whale participation often signals a weakening confidence in the asset’s near-term prospects.
Shiba Inu supply distribution by balance of addresses. Source: Santiment
When big players reduce their holdings, it typically indicates an expectation of further price declines or a lack of incentives to hold for future gains.
Shiba Inu coin’s negative funding rate has compounded the bearish sentiment. The funding rate, which reflects the cost of holding long positions, shows that short positions are currently in control. Traders are paying to maintain short positions, suggesting they expect SHIB’s price to continue falling.
Shiba Inu OI-weighted funding rate. Source: Coinglass
The continuous negative funding rate implies a bearish market outlook, with short traders having the upper hand. This is due to their conviction that SHIB’s price will decline further.
Moreover, SHIB’s open interest has also seen a noticeable decline. Open interest, representing the total number of outstanding futures contracts, has dropped steadily, reducing market participation.
SHIB futures open interest.
The decline often points to a lack of conviction among traders, as fewer new positions are being opened. With OI and the funding rate moving in a bearish direction, whale offloading and declining market activity set the stage for further downward pressure on SHIB’s price.
Whale transactions are key to understanding the bigger picture. As recently seen, large offloads can trigger a cascading effect as smaller investors panic and follow suit, exacerbating the price decline.
Retail demand must increase significantly as whales exit to counteract the selling pressure. However, given the current lack of momentum and broader market uncertainty, such a shift seems unlikely.
Shiba Inu Price’s Bearish Pattern Stays Strong
Meanwhile, the ‘descending triangle‘ setup, a bearish technical pattern, remained strong, forcing the SHIB USD pair‘s bull run to recede after failing to move above the pattern’s descending trendline.
The combined bearish cues could mean a Rektober for the memecoin.
SHIB USD pair formed a bearish setup with a 74% downside target. Source: Tradingview
Analysts recognize the descending triangle as a bearish continuation pattern. The configuration features a declining upper trendline that compresses price action into lower highs, while a flat lower trendline serves as consistent but weakening support.
The pattern signals intensifying selling pressure, resulting in progressively weaker rallies that struggle to breach resistance.
In this setup, traders estimate the potential downside by measuring the maximum height of the triangle. The Shiba Inu coin’s price recently broke out of this descending triangle, only for bulls to push it back within the pattern.
However, if the Shiba Inu Coin’s price confirms the bearish setup, the SHIB USD pair could plummet by over 74%, reaching a target near $0.0000046.
A breakout below the pattern in the current market climate could be catastrophic for SHIB prices, especially considering the indecision among market participants.
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