Shiba Inu has just rebounded off its 100-day EMA which is a positive sign.
It has also seen an increase in burn rates and daily trading volume.
Short-term holders are in profit though and could be joining the long-termers in selling soon.
The positive metrics outweigh the negative and SHIB could be set to rally alongside Bitcoin soon.
Shiba Inu has caught the attention of the crypto market once again. This time with a massive spike in trading activity.
Over the last 24 hours, the memecoin has seen its trading volume rise by more than 20% to nearly $500 million.
This surge, along with other factors has sparked speculation as usual:
Is something huge incoming for this popular memecoin?
According to data from Coinglass, this spike in spot metrics isn’t the only thing seeing a boost.
SHIB derivatives contracts like futures and perpetuals have seen a 26.31% increase in trading volume in the past day.
This spike started on 28 September with more than $900 million and is still going strong today with $307 million (compared to the rest of the year).
Shiba Inu’s volume surge
This spike is also visible in the cryptocurrency’s open interest, which has climbed 14.65% to $53 million.
Open interest on Shiba Inu
This indicates that traders are positioning themselves more and more to profit from the next big move, whenever it comes.
In the charts, Shiba Inu has shown resilience after testing its crucial 100 EMA support level.
It bounced back from this dynamic support and successfully avoided a massive downturn.
Rebound off the 100-day EMA
The memecoin, by holding this support, has cemented its bullish outlook.
This is also despite the ongoing price fluctuations of the rest of the market.
Going forward, Shiba Inu is expected to continue further upward as long as the market's conditions remain stable.
At the time of writing, the cryptocurrency currently trades at around $0.00001760.
This marks around a 4.4% increase in the past 24 hours.
Its market cap has also grown by 5% to around $10.4 billion.
This follows a period where the cryptocurrency was on the verge of a major price drop.
However, community support and ongoing efforts to burn tokens have helped stabilize things.
Interestingly Shiba Inu was one of the major market leaders in late September when it rallied by 67.36% in just nine days.
However it couldn’t break through the bearish order block at $0.000021 despite this price explosion.
This has so far led to a retracement that pushed the price below the key $0.0000175 support level.
Analysts have so far theorized that the ongoing rebound off the 100-day EMA could signal the start of a recovery.
Will SHIB continue to climb in the near future?
Another interesting thing is how the market sentiment around SHIB spiked towards the end of September.
This spike allowed this metric to reach scores not seen in months.
This surge in sentiment also followed several others including a spike in daily active addresses.
Notably, the last time Shiba Inu saw such activity was back in May.
Weighted sentiment and daily active addresses
The “age consumed” metric (which tracks token movement between addresses) has seen noticeable spikes.
This could mean many things. However, it mostly indicates some degree of selling pressure as tokens move from wallet to wallet.
Some interesting trends also emerge between the behavior of short-term and long-term SHIB holders.
For example, the 30-day MVRV (Market Value to Realized Value) ratio remains positive.
This means that short-term holders are still in profit.
The "short-term" aspect also means that this cohort of traders is prone to quick profit-taking.
On the flipside, the 180-day MVRV has dipped below zero. This indicates that long-term holders are breaking even or selling off their holdings.
This is especially reasonable after they endured the downtrend since May.
Shiba Inu’s MVRV readings
The network growth metric also surged along with SHIB’s price—which indicates that more participants have been entering the market.
However the mean coin age has been trending downward since late August—which supports the earlier point that long-term holders have been selling at breakeven.
Meanwhile, other metrics on SHIB are looking up.
The burn rates according to Shib Burn on Twitter, rallied this week.
This metric has shot up by over 1000% where more than 6.54 million SHIB tokens were destroyed.
This may have been one of the contributing factors to the Shiba Inu rebound to $0.00001760.
All of the above has fueled optimism among traders that SHIB may be ready for another major pump.
The burn rate combined with growing trading volumes and increased futures interest signals growing confidence in the market.
Overall some analysts believe that if Bitcoin stages a rally, Shiba Inu could follow suit and climb higher considering the strong correlation between both.
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