Shiba Inu’s multi‑year low tests investor conviction – Traders turn bearish

Shiba Inu [SHIB] extended its downside move for the fourth consecutive day. The 7.50% decline on the 5th of June triggered a breakdown below a major support level and pushed the memecoin beneath its September 2021 low. 

At press time, SHIB declined 7.50% over the past 24 hours and is trading at $0.0000048. Despite the price drop, investors and traders appear to have shown strong interest in the asset, as its trading volume surged 12% during the same period to reach $146 million. 

SHIB breaks September 2021 low

From a price action perspective, SHIB remains firmly in a downtrend, and its daily chart suggests that the memecoin could continue its downward momentum in the coming days.

The factors currently supporting this bearish outlook appear to be the broader market weakness and the breakdown below the key support levels of $0.0000053 and the September 2021 low at $0.0000051.

Based on the current price action, if SHIB closes a daily candle below the $0.0000051 level, it could experience further downside in the coming days.

However, this bearish thesis would be invalidated if the memecoin’s price moves back above the $0.0000053 level.

The Average Directional Index (ADX) suggests that SHIB has strong directional strength. Meanwhile, its price trading below the 200-day Exponential Moving Average (EMA) points to a sustained bearish trend, indicating that sellers remain firmly in control of the asset. 

SHIB: Traders’ sentiment turns bearish 

Besides this price action, the derivative platform CoinGlass suggests that intraday traders are strongly following the current bearish trend.

Data shows that SHIB’s OI-Weighted Funding Rate has dropped to -0.0114%, indicating that short sellers are dominating the market and are willing to pay a premium to maintain their positions. 

Meanwhile, $0.00000464 on the downside and $0.00000512 on the upside are the two major liquidation levels where traders appear to be overleveraged.

According to SHIB’s exchange liquidation map, traders have built $196,000 worth of long-leveraged positions at the lower level and $613,000 worth of short-leveraged positions at the upper level, indicating that bears currently dominate the memecoin.

At the same time, analytics platform Nansen data shows a 302% decline in net holdings among the top 100 SHIB addresses over the past 30 days.

This indicates that whales had already begun exiting their positions before the recent sell-off, which could be one of the factors behind SHIB’s strong downside move. 

Final Summary

• Shiba Inu lost a major support level and fell below its September 2021 low, with the chart signaling further downside risk.
• Traders were strongly following the bearish market trend by increasing short positions and offloading their SHIB holdings.