- SHIB’s bid/ask volume imbalance tipped to the bullish end.
- The token was overbought and selling pressure could pull it further down.
As the dynamics of the crypto market changed for the better, Shiba Inu [SHIB], which has had to deal with a challenging landscape, followed suit. One reason for this idea was IntoTheBlock’s data showing how SHIBs bid-ask volume switched to the bullish side at 6.50%.
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The bid-ask volume shows the relationship between buying and selling volumes by taking into account the number of desired purchases at a given price. Usually, high bid volumes indicate strong demand, with investors willing to purchase the asset in question.
In this case, the price rises. However, when the demand volume is higher, it suggests that more traders are willing to sell. Here the price tends to go lower.
More demand but sellers are lurking
So, in the case of SHIB, ask was higher, which was proven when the price of the token increased by 5.34% in 24 hours. While SHIB has gained significant traction, recent market dynamics also suggest that the road ahead may not be smooth for the token.
One of the reasons this comes into play is the way a number of large trades have ended in bearish outcomes. But has demand been able to outpace sales pressure?
Well, according to the daily SHIB/USD chart, demand initiated at $0.0000071 failed to override seller nullification at $0.0000077.
And while SHIB’s volatility had subsided, as evidenced by the Bollinger Bands (BB), the token could fall again. This was due to the token price touching the upper band.
This could be SHIB considered overbought. This could also be one of the reasons the price dropped from $0.0000078.
According to the Moving Average Convergence Divergence (MACD), the daily chart showed that there was still momentum in the battle between bulls and bears. This was due to the orange and blue dynamic lines approaching each other.
However, buyers had little exchange for sellers. Thus, SHIB’s potential to fall sharply was almost non-existent.
Source: TradingView
Flow remains in bear controlI
Looking further at on-chain data, Santiment showed that SHIB inflows had risen to 122.26 billion. This metric represents the number of tokens sent exchanges. In most cases, when this metric peaks, it means there is a lot of intent to sell.
Conversely, the alternating inflow was 59.55 billion. Unlike inflow, exchange outflow measures the tokens sent from the exchanges to cold storage or self-custodial wallets.
Realistic or not, here it is SHIB’s market capitalization in DOGE terms
An increase in this measure means that holders have the incentive to hold the asset in question for the long term.
Source: Sentiment
With the difference in outflows and inflows from the exchange, SHIB may soon experience more selling pressure.
