Shiba Inu burns 1.42M tokens as sellers tighten their grip – Can SHIB recover?

Shiba Inu [SHIB] saw a massive 42,886% surge in its burn rate over 24 hours, reigniting interest in the memecoin despite the continued selling pressure.

According to Shibburn on X, the network burned roughly 1,428,446 SHIB tokens across two major transactions during the recent reporting period. This sharp increase reflected a significant shift in burning activity, after an extended period of relatively subdued token destruction.

Besides the daily burn activity, the seven-day burn total reached 29,121,654 SHIB, which represented a 78.83% decline as compared to the week before. The most recent burns brought the cumulative total to roughly 410.85 trillion SHIB, even though their immediate supply influence on the price remained limited.

Exchange inflows return as sellers retain control

Despite the surge in token-burning activity, SHIB faced renewed exchange inflows, implying the presence of selling pressure.

CoinGlass highlighted positive Spot Netflows of $237.96K at reporting time, indicating that the exchange inflows exceeded withdrawals.

Additionally, the Spot Taker Cumulative Volume Delta remained seller-dominant, strengthening the broader bearish outlook. In particular, the indicator highlighted continued aggressive selling, with market sell orders outweighing market buy orders. The renewed exchange inflows therefore validated concerns around Shiba Inu’s ability to maintain its modest recovery.

Falling funding rate raises fresh bullish concerns

Furthermore, the declining derivatives positioning introduced another layer of uncertainty to SHIB’s price recovery attempts.

Specifically, SHIB’s OI-Weighted Funding Rate had declined to 0.0036% at press time, suggesting reduced bullish positioning among the leveraged traders.

Here, it is worth noting that even though the funding remained positive, the downward movement implied a weakening demand for long exposure.

For context, the long traders continued paying short traders, but the falling rate suggested that the bullish conviction had started shrinking. The persistent spot selling, meanwhile, validated the cautious outlook despite the token’s latest price gains.

Can recovering indicators keep SHIB above support?

Despite the selling pressure, Shiba Inu [SHIB] strongly defended the $0.00000483 support level after correcting from September’s highs around $0.00000600.

The daily price structure highlighted buyers attempting another price recovery, even when the broader picture continued reflecting earlier selling pressure.

Also notably, the RSI indicator climbed to 41.39, surpassing its moving average of 38.64, which implied improving buying strength, although the indicator remained below the neutral 50 threshold.

Besides,, the Money Flow Index (MFI) technical indicator similarly rebounded to 35.78, suggesting recovering buying pressure.

These indicators together supported a developing recovery attempt despite their relatively low readings.

Conclusively, Shiba Inu’s rising technical indicators provided early recovery signals, but the persistent spot selling and declining funding continued limiting bullish conviction.

Holding the $0.00000483 support level could favor a recovery towards the $0.00000550 resistance, while a breakdown on the other hand would increase downside risks.

Final Summary

• Shiba Inu’s burn rate surged 42,886%, but exchange inflows signaled renewed selling pressure.

• SHIB’s improving technical indicators, however, supported recovery prospects, with $0.00000483 support remaining vital for buyers.