Shiba Inu [SHIB] rallied 16.3% on Sunday, the 4th of January. It was up 26% at the time of writing, measured from the start of the new year.
This rally came alongside a Bitcoin [BTC] price bounce above the $90k level, which lent many altcoins bullish short-term momentum.
In a post on X, crypto market data platform Santiment revealed that a good chunk of the memecoin’s supply was concentrated within a few whales’ wallets.
The top 10 largest SHIB holders controlled 62.65% of the entire supply. It must be noted that the wallet containing 41% is a dead wallet and marked a major burn event from May 2021 by Vitalik Buterin.
Measuring SHIB’s on-chain selling pressure
During the 10/10 crash, Shiba Inu went down 43% in 8 hours after a nasty downside wick on Binance. While it saw a bounce immediately after, it marked a strong bearish continuation for SHIB.
Yet, the mean coin age and dormant circulation metrics hardly spiked higher, showing little sell pressure on-chain. This changed in December.
The metrics illuminate the movements of SHIB on-chain, and more movement of long-term dormant tokens creates more considerable changes in the metrics.
These reflect a flurry of large token movements, likely for selling.
In the past few days, even as prices bounced toward local resistance levels, there wasn’t sizeable on-chain SHIB movement. This suggested low profit-taking pressure from holders and that there was more room for growth.
On the other hand, bulls should beware that the larger SHIB wallets have been falling in number since late November, the supply distribution metric showed. Smaller wallets continued to rise in number.
This lack of whale accumulation indicated the current rally was not a product of long-term buying pressure, but short-term hype.
For traders, there’s nothing wrong with hype. Any volatility is welcome, so long as it brings about a trend. Shiba Inu does have a trend now that is short-term bullish.
This could morph into a rally that lasts a few weeks if bullish sentiment persists.
The Fixed Range Volume Profile tool showed that the $0.0000085-$0.0000087 area was a high-volume support node, with SHIB testing the Point of Control (red) at the time of writing.
A retracement below the $0.0000078 level would be a sign that the momentum had faltered and bears were beginning to control the market once more.
Final Thoughts
- The supply in the hands of the top 10 addresses suggests centralization, but investors should remember that 41% is in a burn address, inaccessible forever.
- The larger SHIB wallets were distributing lately, and a wave of selling was last seen in December.
