The Shiba Inu (SHIB) price has been under significant pressure, continuing its downward trajectory amid broader market volatility. Despite underperforming strong assets like Bitcoin and Solana, SHIB shows signs of a potential rebound—possibly as early as February. While short-term sentiment remains bearish, several fundamental and technical catalysts suggest an 80% recovery could be on the horizon. From declining active addresses signaling capitulation to a surge in Shibarium activity and oversold technical conditions, Shiba Inu may be setting up for a powerful reversal.
Shiba Inu Price Downturn and Declining Activity
The recent drop in SHIB’s price has driven many retail investors away, leading to a noticeable decline in network activity. According to blockchain analytics, the number of daily active addresses has fallen by 23% over the past week, with a more pronounced 32% drop in overall active addresses. Additionally, the count of zero-balance addresses has decreased by over 50%, indicating that some holders are exiting the ecosystem entirely.
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However, this pullback in retail participation often creates opportunities for larger investors. Notably, Shiba Inu whales—holders with substantial token balances—have not followed the sell-off trend. In fact, data reveals that whales still control approximately 58% of the circulating supply. More telling, one major whale recently acquired 275 billion SHIB tokens, a strong vote of confidence in a future price recovery.
This behavior aligns with historical market patterns: when fear spreads among retail traders, whales often accumulate at discounted prices. A similar dynamic is visible in social sentiment, where declining mentions and engagement can precede a reversal as pessimism reaches its peak.
Growing Strength in the Shibarium Ecosystem
One of the most promising developments for Shiba Inu lies beneath the surface—in its layer-2 scaling solution, Shibarium. Despite the token’s price struggles, Shibarium’s network activity is thriving. According to ShibariumScan, total transactions have surged past 863 million and are on track to reach 1 billion by the end of Q1 2025. Meanwhile, unique wallet addresses on the network have exceeded 2.01 million and continue to grow.
This surge in adoption is critical for SHIB’s long-term value proposition. Every transaction on Shibarium uses BONE tokens, a portion of which are converted into SHIB and permanently burned. As transaction volume increases, so does the rate of token burn—creating deflationary pressure that could support higher prices over time.
A robust and expanding ecosystem enhances utility, attracts developers, and fosters new decentralized applications (dApps). These factors contribute to sustainable demand for SHIB, even during periods of market-wide uncertainty.
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Technical Indicators Suggest an Imminent Rebound
From a technical analysis perspective, Shiba Inu is approaching a pivotal moment. The Relative Strength Index (RSI), a key momentum oscillator, has dropped from a high of 82.7 in November to just 36—edging close to the oversold threshold of 30. Historically, when SHIB reaches oversold levels, it has triggered strong corrective rallies. For example, in August of the previous year, a similar RSI dip was followed by a price surge exceeding 200%.
Moreover, SHIB has formed a falling wedge pattern on its daily chart—a bullish reversal formation that typically precedes upward breakouts. The pattern is nearing its apex, suggesting a breakout could occur soon. If upward momentum prevails, the next major resistance level to watch is $0.00003325, which represents an 80% increase from current prices and marks SHIB’s 2024 high.
A break above this level would confirm the bullish outlook. Conversely, a drop below the key support at $0.000016 would invalidate the pattern and extend the bearish trend.
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Frequently Asked Questions (FAQs)
Q: Why might Shiba Inu rebound soon?
A: Several factors support a potential rebound: SHIB is nearing oversold conditions on the RSI, whales are accumulating rather than selling, and the Shibarium network is experiencing strong growth in transactions and addresses—all of which can fuel renewed investor interest.
Q: What technical pattern is forming on SHIB’s chart?
A: A falling wedge pattern is developing on the daily timeframe. This is typically a bullish reversal signal, especially when accompanied by decreasing volume and oversold indicators.
Q: How does Shibarium growth affect SHIB’s price?
A: Increased activity on Shibarium leads to more BONE token usage, part of which is converted into SHIB and burned. This deflationary mechanism reduces supply over time, potentially increasing scarcity and supporting higher prices.
Q: What price target could SHIB reach after a rebound?
A: If the falling wedge completes successfully, SHIB could aim for $0.00003325—the level it reached earlier in 2024. That represents an approximately 80% gain from current levels.
Q: What would invalidate the bullish outlook for SHIB?
A: A breakdown below the $0.000016 support level would negate the falling wedge pattern and suggest further downside risk, potentially extending the current bear market.
Q: Are whales still supporting SHIB?
A: Yes. Despite retail selling pressure, large holders (whales) continue to hold around 58% of the circulating supply. Recent data shows one whale accumulating 275 billion SHIB tokens, signaling strong confidence in a future recovery.
With whale accumulation, strengthening fundamentals via Shibarium, and favorable technical positioning, Shiba Inu appears poised for a potential resurgence. While risks remain in any volatile market, the convergence of these catalysts makes February a critical month to watch for a major move.
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