Shiba Inu (SHIB), a meme coin based on Ethereum, saw a massive 1055% increase in its burn rate today. However, despite this seemingly positive development, the price of SHIB dropped by 2.15%.
This unexpected price movement has left many investors scratching their heads. The burning of tokens is typically seen as a bullish signal, as it reduces the overall supply of a coin, which can theoretically lead to higher prices.
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Here’s a breakdown of the situation
- Burning Surge: According to Shibburn, a tracker for SHIB burns, the community burned a whopping 50.9 million coins in the past 24 hours. This significant decrease in supply fueled optimism among some investors.
- Price Drop: Despite the burning spree, the price of SHIB fell slightly. This could be due to several factors, including a broader market downtrend and a decrease in investor interest. Data from Coinglass shows an 8.23% drop in open interest and a 26.87% decline in derivatives volume, suggesting a decline in market activity.
- Possible Rebound: While the price is down, the Relative Strength Index (RSI) sits at 59, indicating that SHIB is not yet in oversold territory. This suggests that a price rebound or stabilization could be on the horizon.
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The future of SHIB remains uncertain. The recent burning efforts, coupled with ongoing developments within the Shiba Inu ecosystem, could lead to a price increase shortly. However, the broader market conditions and investor sentiment will also play a significant role.
Some analysts, like CoinGape Media, believe that SHIB could see a 16% rally if it bounces off its current support level. This would see the price reach $0.0000345 and potentially even target $0.000038.