Shiba Inu price eyes recovery after 8% drop as Age Consumed spikes and falling 30-day MVRV hint at a possible local bottom forming.
Shiba Inu price (SHIB) emulates historical patterns as two on-chain metrics indicate the emergence of a local bottom.
The Market Value to Realized Value (MVRV) ratio is decreasing in response to an increase in the Age of consumption.
These metrics are extremely bullish following a significant decrease in the price of Shiba Inu over the past seven days, as most meme coins are currently contending with an adverse market sentiment.
Shiba Inu Price Plummet By 8% Today
Shiba Inu price has experienced an 8% intraday loss Today, May 31, as it fluctuates between a daily low of $0.0000123 and a daily high of $0.0000133.
SHIB is trading at $0.0000125 at the time of publication, with $289 million in 24-hour trading volumes.
The recent collapse of the meme coin, which resulted in a $10 billion loss in value for the entire meme token market cap within a week, is concurrent with the declining price of Shiba Inus.
Bearish headwinds are also caused by the sell-side pressure from long liquidations and traders seeking to mitigate losses.
On-Chain Metrics Signal the Bottom
Two on-chain metrics from the analytics platform Santiment suggest that the SHIB price follows previous patterns, which involve a price rebound after it appears to have reached a local bottom.
The following metrics are included:
A surge in the rate of Age consumed AND Declining 30-day MVRV Ratio
Age Consumption Metric Spikes In Shiba Inu
The Age Consumed metric from Sentiment has reached its most significant level since May 20 and has increased by over 1,500% from the previous day, reaching 580 trillion SHIB.
The surge occurred as the price of the Shiba Inu plummeted to multi-week lows.
This metric typically indicates the quantity of coins that are either old or quiescent and are currently in motion.
Long-term holders are likely to unload SHIB when the metric spikes and the price has the potential to recover once the selloff concludes.
SHIB’s bottom is typically correlated with any significant increase in the Age Consumed metric, as evidenced by the preceding trends.
As a result, a short-term relief rally occurred immediately after this metric surged on May 5, May 12, and May 30.
In the interim, this increase is due to a recent Coingape analysis, which indicates that the price of Shiba Inu may rebound to $0.00002 next week due to the formation of a bullish “Rising Three Methods” pattern.
30-Day MVRV Decreases As Shiba Inu Price Decreases
The 30-day MVRV ratio has also decreased to its lowest since March, as illustrated in the chart below.
This ratio is at -10%, suggesting that the current holders of SHIB tokens who acquired them within the past 30 days are carrying a 10% loss.
As with the Age Consumed, the MVRV has previously indicated the floor of SHIB.
The price of SHIB experienced an increase each time the metric reached severely damaging levels, as is currently the case.
Recently, 2 trillion SHIB tokens flooded exchanges, raising concerns about a potential surge in selling activity that could impede the recovery despite these favorable metrics.
In conclusion
The price of Shiba Inu has plummeted by 8% on an intraday basis, as meme coins have lost $10 billion in value over a week.
Nevertheless, the Age Consumed metric has experienced a rapid increase with a decrease in the MVRV ratio, a trend previously associated with a local bottom formation.