Shiba Inu (SHIB) is poised for a significant rally as investors have recently accumulated a substantial amount of the cryptocurrency. Between September 23 and 24, a total of 770 billion SHIB tokens were moved off exchanges, indicating a strong intent among investors to hold these tokens for the long term.
Historical Performance and October Trends
Historically, Shiba Inu has shown positive returns in October. During the 2021 bull run, SHIB’s price surged by an impressive 833% in October. In the subsequent years, the token saw more modest gains of 10% and 6% in October 2022 and 2023, respectively. This historical trend suggests that SHIB could experience significant gains this October as well.
Correlation with Bitcoin
Shiba Inu’s price movement is closely correlated with Bitcoin (BTC). Data from IntoTheBlock shows a strong positive correlation of 0.89 between SHIB and BTC. This means that as Bitcoin’s price rises, SHIB is likely to follow suit. Given that Bitcoin typically performs well between October and December, SHIB could benefit from this upward trend.
Investor Activity and Market Sentiment
The recent accumulation of 770 billion SHIB tokens by investors is a strong indicator of bullish sentiment. This accumulation represents the outflows from exchanges over two days, suggesting that investors are preparing for a potential price surge. Moving tokens off exchanges typically indicates a long-term holding strategy, which can contribute to price stability and growth.
Concerns and Fundamentals
Despite the optimistic outlook, there are some concerns regarding Shiba Inu’s fundamentals. The burn rate of SHIB has dropped significantly, with a 90% decrease in the last 24 hours and a 61% drop over the past week. Additionally, the Shibarium layer-2 network has seen low activity, with daily transactions remaining below 10,000. This low network activity has contributed to the reduced burn rate, as transaction fees on Shibarium are converted to SHIB and burnt.
Broader Market Outlook
The broader cryptocurrency market also looks promising for October. Bitcoin, the flagship cryptocurrency, has historically enjoyed its highest returns between October and December. As Bitcoin rallies, it is expected that other cryptocurrencies, including Shiba Inu, will also experience upward momentum.
Conclusion
Shiba Inu is on the cusp of a potentially historic run, driven by significant investor accumulation and positive market trends. However, investors should remain cautious of the underlying fundamentals, such as the burn rate and network activity, which could impact the long-term sustainability of the rally.
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Disclaimer: This article is for informational purposes only and does not constitute financial advice. Always do your research before investing in any cryptocurrency.
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Disclaimer: This article is for informational purposes only and does not constitute financial advice. Always do your research before investing in any cryptocurrency.
