Bearish Implications for SHIB Price
According to analyst Ali in a recent post on X, the amount of Shiba Inu (SHIB) held on exchanges has been consistently decreasing since November. This decrease is measured by the “Balance on Exchanges” metric, which tracks the total SHIB held in centralized exchange wallets.
When the value of this metric increases, it indicates that investors are depositing more coins to these platforms. Such transfers are often made for selling purposes, which can have bearish implications for the price of the asset.
Conversely, a downward trend in the metric suggests net withdrawals to self-custodial wallets, indicating that holders are accumulating SHIB.
Huge Withdrawals by Whales
In the graph above, we can observe a significant decline in the Shiba Inu Balance on Exchanges since early November. Approximately 8 trillion SHIB, equivalent to around $86 million at the current exchange rate, has been withdrawn by investors from these platforms.
Given the scale of these withdrawals, it is likely that large entities, such as whales, have been involved. This suggests that these significant holders have been accumulating SHIB recently.
Evidence of Fresh Buying
Furthermore, the fact that these net outflows have continued even during the recent uptrend in SHIB’s value adds weight to the notion that these withdrawals have been done for fresh buying. SHIB has experienced an uplift of over 30% since the withdrawals began.
Interestingly, despite the recent price increase, the Balance on Exchanges metric has not reversed its direction. This indicates that whales are not yet ready to sell and reap their profits, but rather have an interest in acquiring more of this memecoin.
It is conceivable that these substantial SHIB investors are accumulating in preparation for a potential bull run next year, as the market eagerly awaits the approval of Bitcoin ETFs.
Shiba Inu recently experienced a decline, dropping to the $0.0000960 level just a week ago. However, the meme coin has since recovered, seeing a 10% surge and reaching the 0.00001083 mark. It is worth noting that a reversal in the Shiba Inu Balance on Exchanges could potentially trigger a short-term drop in the meme coin’s price, making it a development to closely monitor.