Shiba Inu (SHIB) Price Faces Critical Test as Sell-Off Intensifies

In the past 30 days, Shiba Inu (SHIB) has suffered a steep 30% decline, dropping from $0.000025 to $0.000015. This sharp decline has shaken investor confidence

Shiba Inu (CRYPTO: SHIB) has seen a steep 30% decline in the past 30 days, dropping from $0.000025 to $0.000015.

This sharp decline has put the memecoin in a critical zone, and its price action in the coming days will be crucial.

Here's a closer look at the on-chain and technical indicators that could influence SHIB's next move.

Shiba Inu Sell-Off Continues

One key indicator that showcases the activity of short-term holders is the "Balance by Time Held" metric.

This metric essentially checks whether there is an influx of holders buying into a cryptocurrency or if more participants are offloading the asset.

An increase in any of the cohorts is typically a bullish sign. However, the metric shows that the number of SHIB short-term holders has significantly decreased over the past month.

For context, these holders refer to participants who purchased the memecoin within the last month.

The decline in the number of short-term holders signals weakening conviction in SHIB’s potential. This trend also suggests rising selling pressure as investors offload their positions amid uncertainty.

If this metric continues to drop, SHIB’s price could face further downside, as reduced demand may hinder any significant recovery.

No Buy Signal Yet

Moreover, on-chain data from Santiment shows that SHIB’s price-Daily Active Addresses (DAA) divergence has dropped into the negative region.

The price-DAA divergence showcases whether user engagement is increasing alongside the price or not.

When the reading is positive, it indicates rising user participation, a bullish sign that could drive the price higher.

On the flip side, a negative reading suggests that user engagement is declining while the price is also dropping — an indication of weakening network activity. This bearish sign, if sustained, could reduce the likelihood of a strong recovery.

SHIB Bearish Trend Deepens

On the daily chart, SHIB’s price continues to trade within a falling channel with a lower price boundary of $0.000015.

Amid this decline, the Moving Average Convergence Divergence (MACD) has dropped to the negative zone, indicating bearish momentum around SHIB.

Like the MACD, the Awesome Oscillator (AO) reading is also negative. This further reinforces the negative sentiment around the token.

If this trend continues, Shiba Inu’s price is likely to drop to $0.000012.

Alternatively, if SHIB short-term holders decide to accumulate the memecoin again, this trend might not remain the same.

If that happens, then SHIB’s price may bounce toward $0.000025.