Shiba Inu (SHIB) Faces Short-Term Volatility and Liquidity Risks Amid Rising Selling Pressure

Shiba Inu (SHIB), the meme coin that once symbolized the speculative fervor of the 2021 crypto boom, now finds itself at a crossroads. Recent data reveals a confluence of liquidity risks, heightened volatility, and mounting selling pressure, raising questions about its short-term trajectory. This analysis synthesizes on-chain metrics, exchange dynamics, and technical indicators to assess the immediate challenges facing SHIB.

Declining Liquidity and Exchange Dynamics

SHIB's 24-hour trading volume has plummeted by 32% to $219 million as of October 6-7, 2025, according to a WRAL report, a stark contrast to its earlier 2025 highs. This decline in liquidity has amplified price swings, with larger trades disproportionately influencing the token's value. Binance, the largest exchange for SHIB, now holds 1 trillion tokens in reserves-a 200% surge from mid-2025 levels, per a CoinOTAG analysis. While this could signal internal accumulation or strategic positioning, it also raises concerns about potential sell-side pressure if the exchange decides to offload its holdings.

Price Volatility and Technical Weakness

SHIB's 90-day realized volatility has dropped to an annualized 64%, the lowest since December 2023, according to a CoinDesk article, suggesting reduced turbulence. However, this stability is deceptive. The token has been range-bound in a symmetrical triangle pattern between $0.000011 and $0.000013, with a 5% corridor, as noted by CoinDesk. Bearish indicators like the MACD and EMA reflect near-term uncertainty, as discussed in an Analytics Insight article, despite SHIB holding above its 200-day SMA-a fragile sign of underlying momentum. A breakout above $0.000013584 could reignite bullish sentiment, but failure to do so risks a retest of critical support at $0.000012.

Selling Pressure and Holder Behavior

On-chain data paints a grim picture. SHIB's holder count has declined for the first time in two years, dropping by 0.006% as of October 2025, per the WRAL report - a clear signal of waning retail interest. Wallets holding less than 1 billion tokens have retreated, according to the same WRAL analysis, while whale activity has collapsed by 92%, according to a Coinpaper report. This exodus spans all investor segments, from short-term traders to long-term holders. However, not all metrics are bearish: rising Mean Coin Age and reduced dormant circulation suggest some accumulation by longer-term investors, as CoinOTAG noted.

Market Sentiment and Broader Trends

The broader market has shifted toward utility-driven projects, leaving speculative assets like SHIB in the shadows, the WRAL report argues. Capital is increasingly flowing to alternatives like Little Pepe (LILPEPE), further diluting SHIB's appeal, a trend CoinDesk highlights. Historical data also weighs heavily: SHIB has declined in September in 2020, 2022, and 2023, with only a 27% gain in 2024, per CoinOTAG's analysis. This seasonal pattern, combined with declining trading volumes, underscores a maturing market that prioritizes fundamentals over hype.

Conclusion: A Tenuous Equilibrium

SHIB's short-term outlook remains precarious. While on-chain accumulation and a resilient price above key support levels offer glimmers of hope, the broader narrative is one of eroding confidence. Investors must weigh the risks of further selling pressure-driven by dwindling holder interest and exchange reserves-against the possibility of stabilization if long-term holders continue to accumulate. For now, SHIB's symmetrical triangle pattern and bearish technical indicators suggest a wait-and-watch approach, with a focus on liquidity and sentiment shifts in the coming weeks.```