Shiba Inu Tanks 6% But 'Inverted Hammer' Offers Hope to Bulls

Shiba inu (SHIB) dropped sharply early Friday as President Donald Trump's new tariffs weighed on market leader bitcoin and strengthened the U.S. dollar. The price chart still offers bullish hints.

SHIB crashed 6% in a brutal 24-hour selloff from July 31, 13:00 to August 1, 12:00, plummeting from $0.000013 to $0.000012. Prices hit their lowest since July 9, extending the downtrend from the July 21 highs near $0.00001600.

The decline follows a surge in the number of SHIB held on centralized exchanges. The tally surged to 84.9 trillion tokens on July 28, indicating potential whale distribution despite $63.7 million accumulation of 4.66 trillion SHIB, according to CoinDesk's market insights model. Meanwhile, the burn rate explodes 16,700% as 602 million SHIB tokens destroyed in coordinated transactions.

Key AI insights for the past 24 hours

• Price rejection at the $0.000013 resistance triggered a high-volume distribution phase.
• The support base was solidified at $0.000012 with 1.19 trillion tokens of buying interest.
• Breakout volume of 90.51 billion catalyzed a move above $0.000012 barrier.

What next?

Despite the recent slide, the technical outlook appears constructive, thanks July's "inverted bullish hammer" candle.

The inverted hammer comprises a long upper wick, a small body and a largely absent lower wick. The shape indicates that while the bulls initially took prices higher, sellers eventually overpowered and pushed prices nearly back to the starting point of the period.

SHIB. (TradingView) When the pattern appears after a notable downtrend, as in SHIB's case, it indicates that the bulls are looking to reassert themselves in the market. Hence, the pattern represents an early sign of an impending bullish trend reversal higher.

SHIB traders, however, need to note that a drop below the July low of $0.00001108 would invalidate the bullish candlestick pattern.

Disclaimer: Parts of this article were generated with the assistance from AI tools and reviewed by our editorial team to ensure accuracy and adherence to our standards. For more information, see CoinDesk's full AI Policy.

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