The Shiba Inu price rallied to as high as $0.00001413 in the past 24 hours, after breaking above a symmetrical triangle pattern in technical analysis of its daily candlestick timeframe chart. An important factor in this move is the massive drop in SHIB exchange reserves, which fell from 122.54 trillion on July 31 to 121.31 trillion by August 11. Lower exchange balances often indicate reduced immediate selling pressure, allowing bullish momentum to take hold more easily.
Bullish Breakout Backed By Decline In Exchange Supply
One of the most convincing bullish developments for Shiba Inu in recent weeks has been the persistent decline in the amount of SHIB held on centralized exchanges, according to data from on-chain analytics platform Glassnode. Between July 31 and August 11, exchange reserves fell from 122.54 trillion to 121.31 trillion tokens, a decline of nearly 1%, equivalent to over 1.2 trillion SHIB being removed from immediate trading circulation.
Such a reduction holds a strong importance in the context of crypto markets. When fewer tokens are stored on exchanges, it often reflects scenarios of long-term holders moving their coins into cold storage and whales accumulating with no immediate intent to sell. Both outcomes ultimately reduce short-term sell pressure and create a supply squeeze that can contribute to bullish price movements when buying demand increases.
This drop in exchange supply also comes at a time when SHIB has broken out of a bullish symmetrical triangle pattern, with prices rising by roughly 15% in the past week after bouncing from a low of $0.00001279.
SHIB Price Outlook: War Between Bulls And Bears
The battle for SHIB’s short-term direction is now centered around a few important price levels. If bulls can hold the $0.00001438 level and build momentum past $0.00001518, the breakout could strengthen, especially with whales continuing to accumulate and exchange supply trending lower. On the other hand, slipping below $0.00001318 and especially the $0.00001224 price level could invalidate any breakout, and a weak buyer support could possibly drag the token back to $0.00001190.
Recent market behavior shows that SHIB’s fate in the coming weeks will depend on the wider crypto market and if Bitcoin and Ethereum can continue to attract inflows that flow into other crypto assets like Shiba Inu. From here, we can see whether bullish technical patterns and reduced sell pressure can outweigh the bearish cues from dormant coin movements and declining open interest. For now, the SHIB’s price movement is now consolidating after hitting $0.00001413 just yesterday, having recently bounced off $0.00001290.
At the time of writing, Shiba Inu is trading at $0.00001308. From here, every price move can move in any direction. However, the declining exchange supply is likely to tilt the price action onto the bullish side.
Featured image from iStock, chart from Tradingview.com
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