Why Is the Shiba Inu (SHIB) Price Up Today?

TL;DR

• SHIB is well in the green today (August 13), with some analysts recently suggesting it could be ready to soar to a new all-time high in the near future.
• However, some critical indicators, including the RSI, hint that the price might cool off in the short term.

What Triggered the Rally?

Shiba Inu’s price has jumped by over 8% in the past 24 hours and is currently trading at around $0.00001394 (per CoinGecko’s data). Its market capitalization exceeded $8.2 billion, making it the 28th-largest cryptocurrency.

Perhaps the most likely reason behind the pump is the broader rally of the digital asset market, more specifically, the meme coin sector. Popular assets of that type, including Dogecoin (DOGE), Pepe (PEPE), Bonk (BONK), Pump.fun (PUMP), Fartcoin (FARTCOIN), dogwifhat (WIF), and many more have posted double-digit gains on a daily scale.

Another factor could be the resurgence of Shiba Inu’s burning mechanism. The burn rate has exploded by almost 50,000% over the last 24 hours, with nearly 90 million tokens sent to a dead wallet. Interestingly, a single transaction comprised around 98% of that amount.

The program’s ultimate goal is to reduce the overall supply of SHIB coins, thus making them more valuable in time (assuming demand remains strong).

Investors Should Remain Cautious

Despite SHIB’s revival and the numerous predictions on X that the price could keep pumping in the short term, people should keep in mind certain indicators that point to a potential pullback.

Shiba Inu’s exchange netflow has been positive in the last week, signaling that investors have switched from self-custody methods to centralized platforms. This, in turn, increases the immediate selling pressure.

The meme coin’s Relative Strength Index (RSI) is also worth monitoring. The technical analysis tool measures the speed and magnitude of the latest price changes, helping traders identify potential reversal points.

Typically, readings around and beyond 70 suggest the valuation has increased too much in a short period of time and could be due for correction. Conversely, anything below 30 is considered a buying opportunity. As of this writing, the RSI stands above 62.