The price of Shiba Inu (SHIB) has experienced a significant drop this week, falling by another 10% on Wednesday. As investors panic and move their coins away from the memecoin market, what does this mean for the future of SHIB? Will it continue on a bearish trend in the coming weeks?

Recently, crypto investors have been reallocating their capital away from memecoins and altcoins due to increased market volatility. Unfortunately, Shiba Inu (SHIB) has been heavily impacted by this trend.

In addition to the 10% price correction, Shiba Inu has also struggled to attract new users this week, further adding to its bearish outlook.

Shiba Inu is Losing Market Share

Data from Santiment reveals that SHIB has been struggling to attract new demand this week. The Glassnode chart below shows a decline in the number of new wallet addresses created on the Shiba Inu Network Growth since June 11.

Specifically, between June 11 and June 14, the number of new wallet addresses dropped by 133%, from 3,838 to 1,646.

Network Growth measures the rate at which a blockchain network acquires new users by tracking the creation of new wallet addresses. When Network Growth drops consistently, it often has a negative impact on price.

Due to the ongoing SEC crackdown, investors are shifting their capital away from memecoins like SHIB towards Bitcoin and other more resilient mega-cap altcoins. Unless this trend reverses, the bearish trend for SHIB is likely to continue in the coming weeks.

Shiba Inu Network Value is Deteriorating

The rising ratio of Network Valuation to Transaction Volumes indicates more bearish days ahead for the SHIB price. This ratio compares a network’s market valuation to the volume of transactions involving its native token.

Based on the Glassnode chart below, SHIB has been losing traction since June 10. The SHIB NVT ratio increased by nearly 550% between June 10 and June 14, from 35.29 to 229.56.

The NVT ratio is commonly used by strategic investors to assess the relationship between a cryptocurrency’s market capitalization and the level of transactional activity. When the NVT ratio rises, it indicates that the asset is overvalued.

Therefore, the 1600% surge in the NVT ratio adds to the growing bearish concerns that SHIB may experience further price retracement.

SHIB Price Prediction: A Reversal to $0.000005 is on the Cards

According to IntoTheBlock’s In/Out of the Money Around Price distribution data, over 90% of Shiba Inu holders are currently in a net-loss position. This overwhelming bearish trend suggests that SHIB is likely to enter another downswing towards $0.000005 in the coming weeks.

Currently, there are 14,430 addresses that bought 930 billion SHIB tokens and are expected to provide significant support when the price approaches their break-even zone at $0.000006.

However, if this support fails, the price of Shiba Inu is likely to decline to $0.000005.

However, if the price of SHIB rises above $0.000007, the bullish narrative can be reversed. It is worth noting that there are approximately 20,000 addresses holding 8.07 trillion tokens at that price range, which could pose significant resistance.

If this resistance level is overcome, the Shiba Inu bulls may push the price towards $0.000013.