Shiba Inu Price: Can it Maintain Its Ascendancy Amid Traders Transitioning to Profit Collection?

Crypto News- Despite a market recovery, SHIB’s availability on exchanges remains persistently high, possibly due to waning global interest in meme coins, exacerbated by the ongoing Middle East crisis. This situation raises concerns about SHIB’s relevance during the current market upswing.

Shiba Inu Price: Can it Maintain Its Ascendancy Amid Traders Transitioning to Profit Collection?

Notably, it seems SHIB holders are preparing for early profit-taking. Over the past three weeks, they’ve shifted over 1 trillion SHIB tokens to cryptocurrency exchanges, saturating the SHIB market supply.

On October 17, Shiba Inu Exchange Reserves hit a 60-day peak at 170 trillion SHIB, slightly declining to 169.4 trillion on Friday, as per on-chain data from CryptoQuant. These inflows, starting on October 8, have elevated the total SHIB Exchange Supply to a 50-day high of 169 trillion. A substantial increase in Exchange Reserves often signifies an oversupply of tokens in the market, potentially prompting many holders to cash in at favorable prices rather than waiting for a long-term price rally.

Moreover, another crucial on-chain indicator, SHIB Transaction Count, suggests a lackluster performance in SHIB’s price. According to CryptoQuant, there hasn’t been a significant uptick in network activity within the SHIB ecosystem this week. In fact, SHIB’s daily transactions have decreased, with only 4,218 SHIB transactions recorded on October 18, the lowest since May 2023. This indicates that SHIB’s 3% price increase is more likely a consequence of riding the broader market’s bullish trend rather than organic growth in its network activity.

The declining transaction count reflects reduced network demand, a bearish sign. Despite the 3% price increase this week, economic transactions involving SHIB continue to decline. Without a substantial surge in network demand, the overall demand for SHIB tokens may weaken, potentially leading to a bearish price reversal in the near future.