Will SHIB price crash as whales sell?

SHIB price has dropped over 8% in the past 24 hours as whale selling following a brief rally has raised concerns that the meme coin could face another leg lower if buying demand continues to weaken.

According to CoinGecko data, Shiba Inu traded around $0.00000466 at the time of writing, down about 8.4% over the past day after briefly extending last week's rebound. 

The decline has erased much of the rally that pushed SHIB as high as $0.00000537 before sellers regained control.

On-chain data from Santiment indicates that large holders began taking profits as retail traders rushed into the rally. 

Analysts at the blockchain analytics firm reported that SHIB's social dominance climbed to 0.084%, its highest level since April, suggesting retail interest accelerated as prices were already approaching their local peak.

While smaller investors entered on fear of missing out, Santiment recorded 52 whale transactions worth more than $100,000 within a single day, the highest count since late March. 

The firm said the surge in retail buying created enough liquidity for large holders to reduce their positions without immediately overwhelming exchange order books.

The ownership structure of Shiba Inu has also amplified the selling pressure.

Data compiled by Etherscan shows that just 0.05% of wallets control 94.64% of the token supply, leaving price action heavily influenced by a small group of large holders.

Among the largest addresses, the burn wallet accounts for 41.04% of the supply, while major exchange wallets remain among the biggest accessible holders. 

Robinhood controls about 3.92% of the circulating supply, followed by Binance with 3.42% and Crypto.com with 2.76%.

According to the available on-chain data, concentrated ownership means retail buying alone often struggles to absorb heavy profit-taking once whales begin moving tokens to exchanges. 

The latest selloff has followed the same pattern, with the rally fading soon after large transactions accelerated.

The recent weakness has also come as the wider cryptocurrency market has remained volatile. 

SHIB continues to trade with strong correlation to Bitcoin, and periods of uncertainty across the broader market have historically resulted in sharper swings for high-risk meme tokens.

Fundamental support has also remained limited.

Although the Shibarium layer-2 network was introduced to reduce SHIB's circulating supply through token burns, network activity and daily burn volumes have remained relatively modest, leaving price movements largely dependent on speculative demand rather than supply contraction.

SHIB price analysis

On the daily chart, it is evident that SHIB’s recent rally became overstretched before quickly losing momentum.

See below:

SHIB/USDT 1-day price chart. Source: TradingView.

SHIB surged above the upper Bollinger Band during the breakout but has since fallen back inside the bands, indicating the move has cooled after reaching an extreme.

Momentum indicators tell a similar story.

The Relative Strength Index (RSI) climbed above the overbought 80 level during the rally before dropping to around 46, showing bullish momentum has faded significantly over the past two sessions. 

Trading volume also spiked during the rally and remained elevated as prices retreated, suggesting much of the activity was accompanied by profit-taking instead of sustained accumulation.

The Bollinger Band midline, which currently sits near $0.00000495, has now turned into immediate resistance after the latest pullback. 

Unless buyers reclaim that level, the lower Bollinger Band around $0.00000417 becomes the next area traders may watch if selling pressure continues.

The 4-hour chart also points to a market that remains under longer-term resistance despite the recent rebound.

SHIB/USDT 4-hour price chart. Source: TradingView.

SHIB briefly reclaimed its short-term moving averages during the rally before sellers forced the price lower.

At current levels, the token is trading around the 50-day exponential moving average near $0.00000460 while remaining well below the 200-day EMA around $0.00000602, indicating the broader trend has yet to reverse.

Volume Profile Visible Range data identifies heavy historical trading activity near $0.0000060, making it a significant resistance zone should buyers attempt another recovery. 

An intermediate resistance level sits around $0.00000503, where previous buying and selling activity has also concentrated.

On the downside, the 20-day EMA near $0.00000447 offers the first layer of support. 

If that level fails to hold, the recent swing-low region around $0.00000420 to $0.00000430 aligns with the lower Bollinger Band and could become the next downside target. 

A sustained move below that area would leave SHIB vulnerable to revisiting earlier July lows unless renewed buying demand absorbs the continued whale selling.