Shiba Inu Plummets 65% From November High Amid Altcoin Market Crash

Shiba Inu (SHIB) has experienced a significant decline, reaching a crucial support level this week. As of Saturday, SHIB was trading at $0.0000115, just above the week's low of $0.000010. This price point is 35% below the highest level in May and 65% lower than its November high. The crash in SHIB's price mirrors the broader altcoin market, where the market capitalization of all cryptocurrencies, excluding Bitcoin (BTC), Ethereum (ETH), and stablecoins, has fallen from $947 billion in November to $583 billion today.

SHIB has encountered several internal challenges, including a deteriorating Shibarium ecosystem, increased whale selling, and competition from Solana meme coins like Fartcoin and Dogwifhat. DeFi Llama data indicates that Shibarium’s total value locked has decreased by 20% over the last 30 days, dropping to $2.58 million. Most decentralized applications (dApps) in the ecosystem, such as ShibaSwap, WoofSwap, and ChewySwap, have also seen a reduction in assets over the past 30 days. Its total value locked is significantly smaller compared to newer chains like Sui, Sei, and Unichain.

Despite these challenges, there are indications that SHIB's price may rebound soon. After months of selling, there are signs that whales have started accumulating SHIB. Santiment data shows that holders with between 1 million and 10 million tokens have increased their positions to 2.03 trillion from last month’s low of 2 trillion. Additionally, Shiba Inu has become relatively cheap, with an MVRV (Market Value to Realized Value) figure of less than 1, suggesting that it is undervalued as the market price is lower than its realized value.

The daily chart shows that the SHIB price bottomed at $0.00000997 on Monday and then bounced back to $0.00001135. Its lowest point this week was the lowest swing in April this year and August 2024. It has formed a double-bottom pattern whose neckline is at $0.00001755. A double bottom is a highly bullish sign in technical analysis. The Relative Strength Index has also moved from the oversold level of 28 to 40. The token is likely to bounce back and possibly hit the neckline at $0.00001755, representing a 55% increase from the current level. However, a drop below the key support level of $0.0000099 would invalidate the bullish outlook and suggest further downside risk.