Shiba Inu (SHIB) has experienced a significant shift in market dynamics recently, with large holders—the so-called “whales”—abandoning their positions in droves. A 70% fall in large holder netflows has raised concerns about the future of SHIB, with many questioning whether this exodus signals a larger downtrend for the altcoin.

Whale Exodus Leads to Lower Liquidity

The decline in whale activity has had a direct impact on SHIB’s market liquidity, causing the token to become stuck in a bearish range. With reduced trading volume and fewer large transactions, SHIB is now trading below the critical $0.000014 level. This decline in whale participation has resulted in a lack of new capital entering the market, making it more challenging for SHIB to mount any significant recovery.

SHIB’s lack of liquidity, combined with the selling pressure from large holders, suggests that the token could face further downward movement unless new investors step in. The market’s stability will depend on minor increases in trading volume, but the sentiment remains divided, with some investors uncertain about the future trajectory of SHIB.

What Does the Weekly Price Action Say?

At the time of writing, SHIB’s price action shows the coin trading within a descending triangle pattern. Although the coin has managed to rally against long-term resistance, it has been supported by a critical horizontal support level. Currently, SHIB is hovering around $0.000012688, where strong demand has previously emerged.

If this support level holds, SHIB could see a rebound and test both the descending trendline and possible upside targets between $0.000030000 and $0.000045000. However, a shift in momentum would need to occur, and a break above the descending resistance would signal a more positive trend.

On the other hand, if SHIB moves below $0.000010000, it could signal deeper bearishness, with support levels potentially reaching as low as $0.000007000 to $0.000005000.

MACD Signals Bearish Momentum

The MACD trend, a key momentum indicator, also reveals bearish conditions. The Signal line remains below zero, and the histogram momentum continues to fall, suggesting a decline in bullish strength. For an upward price shift to occur, SHIB would need to experience a bullish cross pattern on the MACD, which could indicate the potential for price recovery.

However, even with this possible upward momentum, staying above $0.000012500 could be a challenge. In such a scenario, SHIB might either stay at its current levels for an extended period or see another price drop.

Declining Active Addresses and Burn Rate

In addition to the whale activity decline, Shiba Inu has also seen a drop in active addresses. The number of active SHIB addresses decreased by 6.86%, and new address creation fell by 6.94%. Furthermore, the number of zero-balance addresses saw a decline of 11.18%. This reduction in network activity signals waning interest from smaller investors.

Although SHIB’s daily burn rate surged by 49,552%, it did not lead to any noticeable changes in price, further highlighting that on-chain metrics do not always correlate with price performance. The decline in both whale activity and active addresses underscores the current challenges facing Shiba Inu, as the market struggles to maintain momentum.

Conclusion: Bearish Outlook for SHIB?

Shiba Inu is currently grappling with several signs of bearish pressure, including a sharp decline in whale activity, reduced liquidity, and a downtrend in network metrics. The token’s price is stuck below key support levels, and without a significant increase in new investor participation, SHIB may face additional struggles.

For SHIB to regain upward momentum, the price would need to break above the $0.000014 level and push toward higher targets. Until then, investors will need to monitor market conditions closely, as the coin navigates through an uncertain future.