Although Shiba Inu price has crashed by over 30% from its December high, its ecosystem is doing well, pointing to an eventual rebound. SHIB price comeback will be supported by its futures open interest and the NPL indicator, which points to capitulation.
Shiba Inu Price To Be Boosted By Shibarium Growth
Shiba Inu price was trading at $0.00002225 on Tuesday, much lower than this month’s high of $0.000033. Shibarium, the layer 2 network it launched earlier this year, could be a potential catalyst for the SHIB price.
According to Shibarium Scan, the network has continued doing well even as the mood in the crypto industry worsened. The number of addresses in the network has jumped and crossed the 2.02 million milestone, a sign that it is thriving. Also, the number of completed transactions in Shibarium have risen to over 692 million, a sign that they will cross the 700 million level in the next few weeks.
Shibarium’s network growth is a good thing for Shiba Inu price because some of the fees made in the ecosystem contribute to its burn rate. Data by ShibBurn shows that the SHIB’s burn rate has jumped after Shibarium’s launch.
Leading Indicators Point to a Rebound
Some popular leading indicator predict that the Shiba Inu price will recover. First, Shiba Inu’s open interest in the futures market has dropped to a monthly low. In most cases, a cryptocurrency’s rally starts when the interest is low. For example, the value of SHIB rose by 75% since the open interest bottomed at $38 million on November 6.
Shiba Inu Open Interest
Second, another data shows that the realized profit/loss indicator points to the biggest capitulation in over a month. That is a sign that some investors selling the coin at a loss has increased, which is often seen as a positive catalyst.
Shiba Inu PNL Data
Another data by Santiment shows that the number of active Shiba Inu addresses has dropped from this month’s high of 239,000 to the current 197,000. Cryptocurrencies often rebound when there is capitulation and when many short-term holders – speculators – are selling.
Shiba Inu Price Hammer Points To A Rebound
A quick look at SHIB does not inspire confidence that the token will rebound since it has even crashed below the 50-day moving average. On the positive side, Shiba Inu has formed a hammer candlestick pattern comprising a small body and a long lower shadow. A hammer is one of the best reversal candlestick patterns.
The coin has also found substantial support along the ascending trendline that links the lowest levels since August. Therefore, a move above the 50-day MA will confirm a bullish breakout. It will point to a rally to $0.00003380, 50% above the current level.
Shiba Inu Price Chart
A drop below the ascending trendline at $0.000019 will invalidate the bullish view and point to more down movements.
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