Popular memecoin Shiba Inu (SHIB) has fallen 10% in the past week. Technical indicators paint a bearish picture, hinting at further declines in the cryptocurrency
Let's figure out what awaits Shiba Inu (SHIB) this September and why the memecoin may continue to fall.
Recovery is not expected yet
An analysis of the network value to transaction volume (NVT) ratio shows that Shiba Inu's chances of recovery are currently slim. Historical data also supports this thesis: since 2021, September has always been a period of stagnation or downward movement for the cryptocurrency.
The NVT ratio measures how fast a cryptocurrency's market cap is growing compared to the transaction volume on its blockchain. If the transaction volume exceeds the market cap, it may indicate that the cryptocurrency is undervalued.
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Shiba Inu Network Value to Transaction Volume Ratio. Source: Glassnode
For SHIB, the NVT ratio has increased significantly, meaning that the market capitalization is growing faster than the volume of transactions on the network. In such a situation, one can expect the asset to have unstable dynamics or even a potential fall.
Additionally, net flow from large SHIB holders has fallen by 163% over the past seven days. This metric reflects the difference between the volume of purchases and sales of the cryptocurrency by addresses holding more than 1% of all issued coins.
Clean flow of large Shiba Inu holders. Source: IntoTheBlock
Typically, an increase in net flow from large holders would indicate that SHIB is being bought more than sold, which would drive the price higher. However, the opposite is happening: 44% of SHIB holders are currently losing money. If this trend continues, the token could see a more severe correction, possibly increasing the share of losing holders to 50%.
BIC editorial reported that the Shiba Inu team shared plans to launch an L3 blockchain and several new tokens. Read all the details in our article.
SHIB Forecast: Risk of Big Drop
At the time of writing, SHIB is trading at $0.000013, down just over one percent in 24 hours. The cryptocurrency has fallen by almost 10% over the past seven days.
The daily chart shows that bulls are trying to prevent further decline of Shiba Inu by holding the support at $0.000012. Meanwhile, the technical picture remains bearish, making it difficult to defend this level. In addition, the Chaikin Indicator (CMF) has also moved into the negative zone, indicating that market players are selling SHIB more actively than buying it.
The cryptocurrency is currently moving below the 20-day (blue) and 50-day (yellow) exponential moving averages (EMA). SHIBâs position below these lines is another bearish signal, which also hints at further declines.
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Shiba Inu Daily Analysis Source: TradingView
If current trends continue, Shiba Inu risks falling to $0.000010 by the end of September. However, if buyers manage to push the price above the 20-day EMA, the altcoin will be able to retest the 38.2% Fibonacci level. If successful, the SHIB rate will be able to rise to $0.000017 and even to $0.000020.
