Shiba Inu Price and Burn Rate Decline: Is It Time to Sell?

On December 9, Shiba Inu (SHIB) experienced a notable price drop of around 7%, falling to $0.000030, significantly lower than its high of $0.000033 earlier this month. This downturn in SHIB’s price aligns with broader market declines, as Bitcoin and other altcoins also retreated. Other meme coins, such as Popcat, Peanut the Squirrel, and Dogwifhat, saw similar declines.

In addition to the price fall, Shiba Inu’s burn rate also experienced a sharp decline. According to ShibBurn data, the burn rate dropped by about 90%, falling to 413,412 SHIB coins burned in a day. This comes after a large burn of 250 million SHIB coins on Friday, highlighting the volatility in its token burning process. Shiba Inu has burned over 410 trillion SHIB tokens since its inception, leaving 589 trillion coins still in circulation. The ongoing burn efforts are intended to reduce supply over time, potentially increasing the value of the remaining coins.

Despite these negative indicators, Shiba Inu’s broader ecosystem shows signs of growth. Shibarium, the layer-2 network for Shiba Inu, has processed over 623 million transactions and has surpassed 2 million addresses. Additionally, the BONE token, part of the Shiba Inu ecosystem, has seen nearly 2 million transfers. The decentralized exchange ShibaSwap has also been performing well, with over $28 million in total value locked and annualized fees reaching more than $3.2 million.

Technical Outlook: Potential for Further Gains

Looking at the daily chart, Shiba Inu has recently faced resistance around the $0.00003280 level, marking its highest point since March 28. Despite the recent price drop, SHIB appears to be forming a golden cross pattern—a bullish technical signal—where the 200-day and 50-day weighted moving averages have crossed. The coin also seems to be forming a cup and handle pattern, with a depth of approximately 67%.

Using this pattern as a basis, the target price for SHIB could reach $0.00005478, which is approximately a 67% increase from its recent high of $0.00003280. However, for this bullish outlook to materialize, SHIB would need to break its year-to-date high of $0.000045.

Support and Risk Levels

The bullish trend could be invalidated if SHIB’s price falls below its 50-week moving average at $0.000026. This level serves as critical support, and a drop below it would likely signal a shift in sentiment, with further downside risk.

Hold or Sell?

While Shiba Inu is facing a short-term price pullback and a decline in its burn rate, the long-term outlook remains positive due to the growth in its ecosystem and the bullish technical patterns forming. If you are holding SHIB, it may not be time to sell just yet, especially if the price holds above key support levels like $0.000026. However, if the price fails to break resistance and continues to struggle, it could be prudent to reassess your position.