Many people have speculated about the significance of Shiba Inu token burns and how they may impact the price of Shiba Inu tokens over time. However, one analyst has identified the biggest problem with these burns – namely, that they drop the price of Shiba Inu tokens significantly as a result.
The Shiba Inu token burns occur when large numbers of Shiba Inu tokens are sent to specialized “burn” addresses, which permanently remove them from the circulating supply. While this is often touted as a way to reduce inflation and increase the value of remaining tokens, it appears that in practice, the opposite usually occurs – namely, the price of Shiba Inu tokens drops significantly after a burn occurs.
This can be seen by comparing the price of Shiba Inu in April, when around 26 billion tokens were burned, and in September, when only 1.75 billion tokens were burned. Despite the fact that more than ten times as many Shiba Inu tokens had been burned in April, the price of Shiba Inu in September was over 93% lower.
Clearly, something is amiss with the way that Shiba Inu token burns are currently being implemented. One possible explanation may be that because they dramatically reduce supply while having a much smaller impact on demand, they simply increase market volatility and drive prices down. Whatever the reason, it appears that Shiba Inu token burns are not having the intended effect, and may instead be contributing to a cycle of lower prices followed by further burns – creating an unsustainable downward spiral for the price of Shiba Inu tokens.
The RSI and MACD indicators on SHIB suggest that the price may be heading downwards in the near future. Both indicators are currently in negative territory, suggesting a bearish market sentiment. Furthermore, recent price movements have been relatively bearish, indicating that the downward trend may continue for some time to come.
The Ichimoku indicator on SHIB also suggests that there may be a downward trend in the price. The Ichimoku cloud is currently red, indicating that the price is currently below the cloud and that there may be some bearish momentum. Additionally, several other indicators on this chart also point to a downward trend, including the Senkou Span A and B lines. In short, it seems likely that SHIB will continue to experience downward pressure in the near future.
If you’re interested in trading SHIB or other cryptocurrencies, it’s important to keep an eye on these indicators and stay up-to-date with market trends and news. Doing so can make more informed decisions about when to enter and exit trades, potentially improving your overall returns over time.