Shiba Inu (SHIB) has lately seen an unexpected decline in trading volume and price. While this may first appear to be a bad development, a deeper look indicates that this dip may potentially be the digital asset’s saviour. This is why.
The price of SHIB has decreased as of the most current data, moving away from its most recent highs. A decline in trade volume has coincided with the price decline, which is frequently seen as a pessimistic indicator. However, there might be a benefit to this drop in trade volume.
A decrease in trade volume might be a red flag in a normal rise. It can be a sign that fewer people are interested in or confident in the item, which would lessen buying pressure. This decrease in trade volume, however, may really be a good thing for SHIB.
The argument is that because trade volume has decreased, the market is less liquid. While this may be unfavourable during an uptrend, it may be advantageous if there is a sudden increase in the network’s purchasing power.
With less liquidity, increasing the price of SHIB requires less purchasing power. To put it another way, a rapid increase in purchasers might have a more significant effect on the price, resulting in a more noticeable upward rise. This decreased liquidity might serve as a stimulant, enhancing the effects of a favourable news or market mood.
It’s possible that the present decline in SHIB’s price and trading volume is paving the way for a future upswing. The decreased liquidity might lead to a sharp price increase if market circumstances are favourable and there is a surge in demand in SHIB.
This situation does not, however, come without peril. Reduced liquidity can worsen negative trends just as it can increase positive moves. The market might experience a greater loss as a result of a quick sell-off, increasing market volatility.
