Shiba Inu (SHIB), the second-largest meme coin by market capitalization, is facing severe downside momentum as several technical indicators turn bearish. The market entered a correctional phase due to Bitcoin's decline, leading to a 61% drop in Shiba Inu's burn rate and its trading volume falling below $400 million.
One of the primary catalysts for Shiba Inu's growth was its aggressive token burn strategy. Since August 2020, the Shiba Inu ecosystem has burnt 410.7 trillion tokens from its initial supply of 999.9 trillion. However, recent data from Shibburn, a Shiba Inu burn tracker, revealed a 61% decline in burn rate over the past 72 hours. While this decline caught attention, Shibburn showed a 470% increase in burn rate in the last 24 hours.
In addition to the drop in burn rate, Shiba Inu's trading volume has dipped below $400 million to $379 million, according to CoinMarketCap. This decline signals a reduction in investor interest, often a precursor to price declines in the crypto market.
Several factors are contributing to the drop in Shiba Inu's market indicators. The broader crypto market has experienced heightened volatility after Bitcoin's price crashed below $100,000. This price drop affected most cryptocurrencies, with meme coins like SHIB bearing the brunt.
The ongoing trade war between the US and China, Canada, and Mexico has also harmed the crypto market. Following the announcement of the trade war, Bitcoin's price fell, followed by other major cryptocurrencies and meme coins.
As of this writing, the Shiba Inu price has plummeted to new lows around the $0.000015 mark. This crash in market value is driven by bearish technical indicators, decreased investor confidence, and ongoing market volatility. Other technical indicators, excluding burn rate and trading volume, have also taken a hit as SHIB's Moving Averages (MAs) are currently in the red. Its Relative Strength Index (RSI), sitting around 31%, indicates a neutral level.
New reports from IntoTheBlock reveal that Shiba Inu is currently showing strong bearish signals. After experiencing a 30% price crash over the past month, the meme coin has struggled to regain momentum. CoinMarketCap's data also shows that the cryptocurrency has steadily declined over the past few days, with a nearly 20% drop last week and another 5.5% decrease in the past 24 hours.