- SHIB drops 25.3% in a month as market sentiment weakens.
- Falling Open Interest signals reduced speculation and trader confidence.
- Whale transactions plunge 80%, limiting liquidity and recovery potential.
Shiba Inu has been falling hard, leaving investors frustrated. A small 0.3% bounce brought slight relief, but the bigger picture still looks bad. Over the past week, SHIB has dropped 9.4%. The past month has been worse, with a massive 25.3% decline. This is not a random price dip. A deeper shift in market sentiment is draining momentum. Something is pulling SHIB down fast. Let’s break down the major forces driving this plunge.
Traders Are Closing Positions, Weakening Momentum
A major reason for SHIB’s drop is the decline in Open Interest. This metric tracks the number of active futures and options contracts. When Open Interest falls, traders are closing positions, reducing speculation and slowing momentum. A fading market pulse usually signals lower confidence among investors. Data from Coinglass shows Open Interest for SHIB has fallen 10% in just one day.
The total now stands at $105.94 million. Open Interest volume has also dropped 12.57%, sitting at $77.41 million. Fewer active contracts mean traders are stepping back, leaving less support for price stability. Without new buyers, SHIB may struggle to recover. A shrinking Open Interest often leads to further losses. A rebound requires fresh demand, but that has yet to appear.
Big Investors Are Pulling Back
Large investors, also known as whales, often influence crypto markets. Their buying and selling decisions shape market trends. A decline in whale activity often signals a lack of confidence. IntoTheBlock data shows a massive drop in large SHIB transactions.
Earlier in January, whales made 698 transactions. That number has now plunged to just 52. This marks an 80% collapse in high-value trades. Fewer whale transactions mean less liquidity and weaker market support. Without strong backing from whales, smaller investors hesitate.
The absence of large-scale accumulation makes a price surge unlikely. While charts suggest a possible bounce from key demand levels, speculation alone cannot fuel long-term recovery. Confidence must return before SHIB regains strength.
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