ETH whales are taking advantage of the short-term profit opportunity for Shiba Inu. A lack of strong demand can relegate SHIB to a narrow range.
According to a January 5 Whalestats analysis, Shiba Inu [SHIB] found its way back into the top 10 crypto tokens by trading volume among the 500 largest ETH whales.
This is a good sign in terms of demand as the price attempted to reach an important support level. However, there may be a twist to this observation that may not translate into bullish volumes.
Check out the top 100 whales here: https://t.co/tgYTpOm5ws
— WhaleStats (crypto whale tracking) (@WhaleStats) January 5, 2023
Are your positions flashing green? Check SHIB profit calculator
Whale activity can be lowered in either direction by contributing both bullish and bearish volumes. The last time ETH whale activity favored SHIB was in late December.
Fast forward a few days later and the cryptocurrency had already gained some upside. Not a strong advantage, but enough to generate significant profits for large trades.
Another run-of-the-mill retail shakedown?
SHIB’s transaction volume increased sharply, peaking on December 29. Transaction volume fell over the next few days until January 5, when there was another spike in transaction volume.
In addition, there was an interesting correlation between transaction volume and address activity. There was an increase in 24-hour active addresses from December 26-January 1 before the activity quickly declined. From January 4 until the time of writing, there was another resurgence of address activity.
These observations indicated that ETH whales were targeting near-term marginal gains, and here’s why. The spike in address activity and transaction volume towards the end of December led to a bullish pivot. This was supported by accumulation by ETH whales, which may have encouraged retailers to get into FOMO, creating some exit liquidity.
What Do Shiba Inu Stats Suggest?
An overview of the price action over the same period can help pinpoint the same point. SHIB managed to gain as much as 12% from its December lows, resulting in an interaction with the 50-day moving average.
How many SHIBs can you get for $1?
The interesting thing here is that the 50-day MA acted as a profit-taking signal. This also happened when the RSI reached its midpoint, adding to another sell signal. Hence, the recent surge in ETH whale volumes may actually be selling pressure. The price has since dropped about 5% from its price at the time of writing.
SHIB’s recent upside appears to be supported by low activity, hence the lack of strong momentum. Thus, ETH whales may have benefited from cashing in some profits. Thus, SHIB may re-enter a narrow range in the near term given the current support level and limited demand.
This post Shiba Inus [SHIB] short-term upside may be limited, here’s why
was published first on https://ambcrypto.com/shiba-inus-shib-short-term-upside-might-be-limited-heres-why/