Shiba Inu’s massive 2532.14% burn surge – Can it trigger a price rally?

• Shiba Inu’s massive token burn surge aims to reduce supply, but the price remains under pressure
• On-chain signals and liquidation heatmap revealed bearish sentiment, signaling potential further price declines

Shiba Inu [SHIB] is in the news again after a massive 2532.14% hike in token burns over the last 24 hours – An encouraging move for its community. At press time, the price of SHIB stood at $0.00001469, underlining a 6.16% fall in the last 24 hours. 

This surge in burn activity highlighted the efforts to reduce circulating supply, which could eventually lead to upward price pressure. And yet, despite this impressive burn momentum, SHIB’s price has remained under pressure since, 

Is Shiba Inu on the brink of a breakout? Key levels to track

Shiba Inu’s recent price action underlined a classic head and shoulders pattern, signaling potential downside if the support levels fail. SHIB seemed to be hovering around $0.0000147, testing its critical support after a significant drop.

Traders should monitor the $0.0000147-level closely as a breakdown could lead to a further fall towards the $0.00001261-level. On the other hand, if the support holds, there may be a chance for a reversal and a retest of the $0.00001718 resistance zone.

Therefore, while the pattern may be hinting at a bearish outlook, the price could still recover if the support level holds firm.

Source: TradingView

SHIB’s on-chain signals – Bearish sentiment remains strong

The memecoin’s on-chain metrics highlighted bearish sentiment, which may indicate ongoing pressure on the price. The net network growth climbed by just 0.27% – A sign of weak activity in terms of adoption. 

Additionally, the “in the money” metric fell by 1.06%, showing that many holders are currently underwater on their positions. Also, even though concentration remains low, large transactions dropped by 9.95% to imply reduced institutional interest. 

To put it simply, on-chain data alluded to continued downward momentum unless a shift in sentiment occurs.

Source: IntoTheBlock

SHIB’s liquidation heatmap – Trader liquidations at critical levels

Finally, SHIB’s 24-hour liquidation heatmap highlighted the risk faced by traders. In fact, a significant number of liquidations occurred near the $0.0000145-level, adding to the pressure. 

These yellow and green zones on the heatmap indicated where liquidations are most likely, which could amplify price movement in either direction. 

As a result, the heatmap suggested that SHIB’s price could see a further decline, especially if the liquidation risk materializes.

Source: Coinglass

Can SHIB rally or will it fall further?

While Shiba Inu’s burn activity is substantial, the bearish market signals and price movement mean that a short-term rally might not be sustainable. The key support levels must hold for a recovery to take place. 

Therefore, despite the promising burn surge, SHIB may continue to face downward pressure unless stronger market catalysts emerge.