Shiba Inu (SHIB), a popular meme coin, has experienced significant price volatility in recent months. While the broader cryptocurrency market faces a downturn, an analyst presents a bullish prediction for SHIB based on the Elliott Wave Theory. However, prevailing market sentiment and on-chain data paint a contrasting picture.
Potential Surge Based on Elliott Wave Theory
Market analyst Big Mike utilizes the Elliott Wave Theory, a technical analysis framework, to argue for a potential SHIB price surge. This theory proposes that trends unfold in a specific five-wave structure. Big Mike suggests SHIB is currently navigating the third wave of a larger uptrend on the weekly chart.
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According to this analysis, the first wave peaked in early August 2023 at $0.00001135, followed by a correction (wave two) that drove the price down to $0.0000661 in October 2023. Big Mike anticipates wave three to propel SHIB beyond its previous highs, potentially reaching $0.0005059. This signifies a staggering 2000.91% increase from the current price of around $0.00002408.
$SHIB can break through the level marked off and confirm my higher targets pic.twitter.com/LPkLi40ZWW
— BigMike7335 (@Michael_EWpro) May 4, 2024
Bearish Market Sentiment and On-Chain Data
Despite Big Mike’s optimistic outlook, current market conditions and on-chain data suggest significant challenges for a substantial SHIB rally. Bearish sentiment dominates the market, with investors depositing a net value of $11.359 million in SHIB to exchanges since April 22nd. This trend typically indicates increased selling pressure, potentially hindering upward momentum.
Santiment, a crypto data analysis platform, corroborates this concern. Their data reveals that addresses holding significant amounts of SHIB (between 1 million and 1 billion tokens) have consistently sold off their holdings. In addition, wallets holding between 100 million and 1 billion SHIB have offloaded a substantial 1.98 trillion tokens since February 24th.
A potential counterpoint to the bearishness is the gradual increase in Shiba Inu’s social dominance. This metric gauges the level of social media activity surrounding a cryptocurrency and can sometimes precede price hikes.
We are on twitter, follow us to connect with us :- @TimesTabloid1
— TimesTabloid (@TimesTabloid1) July 15, 2023
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The future price trajectory of Shiba Inu remains uncertain. While the Elliott Wave Theory suggests a potential surge, prevailing market sentiment and on-chain data indicate significant obstacles.
The rise in social dominance offers a sliver of optimism, but its impact is difficult to predict precisely. Investors interested in SHIB should carefully consider both the bullish and bearish arguments before making investment decisions.
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