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Price Movement and Market Context

The Shiba Inu (SHIB) price declined by over 3% on Sunday, partially reversing gains made on Friday after Jerome Powell’s remarks at the Jackson Hole Summit. This drop mirrored broader market movements, with Bitcoin (BTC), Ethereum (ETH), and other altcoins like Ethena (ENA) also experiencing pullbacks.

Decline in Whale and Smart Money Activity

Data from Nansen indicates a reduction in holdings by savvy investors and whales. Smart money holdings have decreased to 40.42 billion SHIB tokens from a July peak of 48.6 billion, remaining stagnant since August 5. Whale holdings have similarly fallen to 45 billion SHIB from 47.6 billion last month, suggesting concerns over SHIB’s performance following a 60% decline from November highs.

Ecosystem Challenges with Shibarium

Activity on Shibarium, Shiba Inu’s layer-2 network launched in 2023, has weakened. Total value locked (TVL) has dropped to $1.79 million, with no stablecoin activity and only 17 DeFi protocols in the ecosystem, including Shibarium, WoofSwap, ChewySwap, and DogSwap. This lack of engagement undermines efforts to transition SHIB from a meme coin to a utility token, as reduced fees limit the token burn mechanism designed to increase scarcity.

Technical Analysis and Outlook

On the daily chart, SHIB price has been consolidating in a sideways pattern, with the 50-day and 100-day Exponential Moving Averages acting as key levels. The Average True Range has decreased, indicating low volatility. A symmetrical triangle pattern is forming, with convergence imminent. A bullish breakout could target resistance at $0.00001600, the high from July 22, while a bearish move might test support at $0.00001015, the June low.

Thesis and Supporting Arguments

The subdued whale activity and weak Shibarium metrics point to diminishing investor confidence and utility challenges for SHIB. Key arguments include:

• Reduced holdings by large investors reflect skepticism about near-term price recovery.
• Low TVL and protocol count on Shibarium highlight ecosystem underdevelopment.
• Technical consolidation suggests an impending volatile move, dependent on broader market cues.

This analysis is for informational purposes only and does not constitute financial advice. Always conduct your own research before investing.