Why is the Shiba Inu Price Surging Today?
The price of Shiba Inu has experienced a significant increase of over 14% on July 8, reaching a daily high near $0.000017. This surge in price can be attributed to various factors, including on-chain metrics and a bullish technical setup, which are likely driving the current upward trend.
Data from CryptoQuant and Santiment provide valuable insights into the factors influencing the price action of SHIB. According to CryptoQuant, there has been a notable shift in SHIB’s exchange netflow, with billions of SHIB tokens being withdrawn from exchanges in recent days. This suggests that investors are moving their holdings from exchanges to private wallets, indicating a trend towards accumulation rather than immediate selling. The decrease in net flows over the past 30 days further supports this notion, suggesting a strong inclination among investors to hold onto their SHIB tokens. This shift in behavior could be a key reason behind the current surge in Shiba Inu price.
Santiment’s data on SHIB distribution by balance also supports the bullish narrative. While larger holders have reduced their holdings, smaller holders have either remained stable or increased their positions. Specifically, addresses with balances between 100,000 and 1 million coins and 10 million to 100 million coins have shown resilience and growth in terms of SHIB holdings. This indicates that while some whales may be selling off their tokens, the broader base of investors remains confident in Shiba Inu.
Despite the cautious approach of larger holders, overall sentiment towards SHIB appears optimistic. Stable open interest and funding rates suggest a market in a consolidation phase, waiting for new catalysts to drive further growth. This anticipation could potentially lead to a breakout, especially considering the signals of reduced sell pressure and steady accumulation by smaller holders.
In addition to these fundamental factors, the SHIB price has formed a bullish technical setup known as the ‘bull flag pattern.’ This pattern emerged as the memecoin rebounded off the support trendline of the flag, avoiding a break below the pattern that could have invalidated the setup. The bull flag pattern typically occurs in assets that are experiencing a strong uptrend. After a steep rise, the asset goes through a consolidation phase, represented by the flag. During this phase, the price remains stable as buying pressure persists. A breakout from this consolidation phase often triggers another significant uptrend. According to technical analysis, if SHIB confirms the bullish pattern, the price could potentially rally by approximately 395% to reach a theoretical price target near $0.0000794.
While it’s unlikely for the memecoin to reach the pattern’s target price immediately after confirming it, a breakout could attract more buyers to the market, further driving the upward momentum of Shiba Inu.