Shiba Inu Metrics Squeeze The Price
A few months ago, the Shiba Inu token had been on the list of top 10 cryptocurrencies as per their market capitalization.
Today, the meme token has dropped two places because of the downturn in its price. However, it is not the only SHIB metric to have recorded a downtrend.
Market Cap and Activity
The data from CoinGecko shows that the market cap of the Shiba Inu token is now a shadow of what it had been.
Market cap is calculated as the product of the circulating supply and the price of a token. Therefore, a price increase automatically pushes up the market cap.
Moreover, a decline in market cap translates to a decline in price. Data from CoinGecko shows that SHIB had a market cap of $18 billion in March.
However, the figure has dropped to $10.64 billion since then, which means there has been a hefty drop of nearly $8 billion.
In addition to the market cap, the activity on the Shiba Inu network has also been trending downwards. There have been major declines in the total number of zero-balance addresses, active addresses, and news.
This trend has become very pronounced in the last 7 days. There has been a 15.45% decline in new addresses, while a 71.27% fall has been recorded in zero-balance addresses.
Likewise, a 45.39% fall has been seen in active addresses. If the overall network activity continues to drop, the price of the meme token is likely to suffer.
Short positions
It is also worth noting that the Funding Rate of the Shiba Ina token dropped on June 17th and has been negative since then. It currently stands at 0.008%.
A positive funding rate shows that there is bullish sentiment amongst traders, while a negative funding rate indicates the opposite.
Hence, a negative funding rate means that trader sentiment has turned bearish for the Shiba Inu token. Therefore, it will be quite challenging for the price of the meme token to record a bounce.
In 14 days, the price has recorded a drop of 28.50%.
Price prediction
The price can get support from a large number of addresses that are in the green, while a large number of addresses in the red serve as resistance.
As far as the second-largest meme token in the market is concerned, there are about 6,720 addresses that have paid an average price of $0.000018 for 413.41 trillion tokens.
This means these addresses are in the green. Meanwhile, there are 13,940 addresses that are in the red. They have bought 1.12 trillion SHIB tokens at this price.
Given that the support and resistance levels are so close, the Shiba Inu token is expected to trade sideways for some time.
But, if any of the 13,940 investors choose to break even, then it could push down the price of the meme token to $0.000016.
The Funding Rate is also relevant because an increase in short positions could see the price of the token rise to $0.000020.
