Is Shiba Inu a Good Investment?
Is Shiba Inu a Good Investment? Read on for a detailed analysis of Shiba Inu
Shiba Inu has been struggling this year and it is trading over 75% lower since January 2022. Shiba Inu’s all-time high price was $0.00008845 and since then the price of Shiba Inu has crashed by over 90%. Looking at the performance of Shiba Inu, there has been a question about the future of Shiba Inu.
So, Is Shiba Inu a Good Investment?
Before discussing whether Shiba Inu is a Good Investment, let us analyze the past performance of Shiba Inu:
In 2021 when the entire Cryptocurrency market was booming, Shib rose from $0.00000001 in Feb 2021 to $0.00003379 by December 2021. That is 3371x higher.
In 2022 so far, Shib is down 65%. Let us look at all the Cryptocurrencies with more than 1 Billion Market cap. We then exclude Stablecoins. Shib is ranked 23rd among the top 49 coins with more than $1 Billion Market Cap. This is an average performance.
So in 2 years, Shib has one brilliant year and one average year, relatively speaking. With this new information, Is Shib Inu a Good Investment?
Shib has one of the most aggressive consumer focussed agendas across all the cryptocurrencies. The Shiba Inu community has come to a realization that it can only rise if it gets rid of the meme coin tag and has some utility. To do that SHIB has come up with many projects.
- Shiba Eternity: Shiba Inu launched gaming a few weeks ago and the response was quite good.
- SHIBVERSE: Shiba Inu is making a jump for the metaverse space, since it is on the rise, Shibaverse’s entry should be easy since it is an already established coin.
- SHIBARIUM: SHIB is built on Ethereum’s blockchain which charges humongous GAS fees which hinder the investors to transact and decrease the flow of tokens or fiat money in the market. To counter this, SHIB developers are making their own blockchain which would remove GAS fees, which may or may not be replaced by some other charge by the developers.
What has already been implemented?
- Payments – Partnerships (Gucci, Tag Heuer, AMC, Sao Polo FC tec)
- Burn SHIB: SHIB developers are in the process of introducing a platform that would allow holders to burn SHIB tokens, which would reduce the number of tokens in circulation, and would reduce the burden of lack of scarcity.
- Rewards (Leash)
- Bone (Governance Token)
- Doggy Dao: Shiba Inu makers have recently launched the first phase of Doggy DAO.
Shiba Inu has been struggling through the last 12 months after inflation rose beyond 6% in November 2021. Over the last 12 months, the Federal Reserve began to reduce the size of its balance sheet as well as increase interest rates. This has reduced liquidity available for altcoins like Shiba Inu.
Is Shiba Inu a Good Investment? The Liquidity Problem
- September-October 2022
- Trading volume range: $90 M and $400 M
- Number of Days when Trading Volume was greater than $1 Billion: 0
- September-October 2021
- Trading volume range: $184 M and $18000 M
- Number of Days when Trading Volume was greater than $1 Billion: 14
The Shiba Inu development and community efforts have been quite positive and should help Shiba Inu. However, as analyzed earlier, the liquidity crash prevents a quick recovery. Macroeconomics is unlikely to recover this year and will probably recover later next year. Therefore, while Shiba Inu certainly go up, it is unlikely to be anytime soon.
Overall, it appears, there is enough in development to make it a worthwhile investment.
Is Shiba Inu a Good Investment: Technical Analysis
Looking at the daily charts of Shiba Inu, we can say that right now it is taking support from the last trendline support which has been traced since the time it was listed. $0.00000750 will be a crucial level to watch out for. Any break below this level will bring down the price of Shiba Inu to its last demand zone and prices could fall as low as $0.00000500.
Buyers can take a risk at these prices with very small stop loss as this trendline is bound to give major support to Shiba Inu. In May 2022, it broke its very crucial level of $0.00002080 after which it made a low of $0.00000800. This has now continued to form a bearish head and shoulders on the daily time frame. If the neckline marked in the yellow rectangle gets broken then we could expect a massive sell-off in the crypto.
Crucial levels for buyers to watch out for will be $0.00001300 and $0.00001657. Any bullish momentum can be expected only after the break of $0.00001300. The RSI saturation is also very high in the particular crypto which implies that any small bullish momentum is good enough to bring it to the overbought zone with no actual increase in the price.
Is Shiba Inu a Good Investment: Conclusion
The investment in Shiba Inu will not be a profitable one if a trader is expecting to make a short-term gain. There are no visible signs which suggest the rise of Shiba Inu in the next few months. However, considering the past performance of Shiba Inu, it can be part of a long-term investment. So, Shiba Inu currently is best suited for long-term investment only.