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The average outflow of SHIB tokens from exchanges surged to another high, crossing the 1 billion threshold per transaction. According to CryptoQuant, the mean SHIB withdrawal from exchanges now sits at 1.02 billion tokens.
Inflows are still bigger than outflows, though, with around 86 trillion SHIB sitting on exchanges.
The surge in outflows is most likely fueled by retail investors. It does not correlate with the activity of institutional SHIB wallets or funds, so it is safe to say that the largest players are staying sidelined or are not exposed to SHIB at all.
There is a good possibility that SHIB will find ground for a proper recovery much sooner than anticipated.
When can we see the reversal?
Multiple indicators suggest a retrace, but the overall market picture is grim, to say the least. Investors are not buying en masse; there is some accumulation, though, which could always be tied to automated market making.
The spike in usage and volatility is explainable, considering the $1.6 billion liquidation on the market and the plunge of Bitcoin below the critical price level of $70,000. Active addresses and the transaction count on the network also went up over the last 24 hours.
Most altcoins did not see any spikes in selling because they were already oversold. SHIB does not show a very strong correlation with Bitcoin; rather, it correlates with altcoins of the same echelon, so a recovery will be possible on par with the broader market retrace that would include assets like XLM, XRP and Ethereum.
Cryptocurrency market struggles
The market is weak and might get weaker, but the most selling pressure SHIB could face has already been injected.
Today, SHIB dipped to $0.00000416, close to its July low of $0.00000413. The drop below the $0.000004 zone is not a guarantee of anything.
SHIB has already been lower, the volume is barely relevant, and momentum indicators do not provide anything meaningful, so the market is already in a weak spot.
Shiba Inu volumes are extremely low, which suggests a lack of volatility ahead. It is also a good sign for a bearish market.