Shiba Inu’s burn rate recently spiked by an impressive 254,078%, resulting in the removal of 5.63 billion tokens in a single day. Despite this aggressive burn, SHIB’s price saw only a modest 3.03% increase, trading at $0.00001781 at press time.

A Key Question: Will This Burn Trigger a Sustained Price Rally?

The primary question now is whether this latest burn can spark a lasting rally or if it will mirror previous instances of short-lived gains.

Historical Impact of Burn Rate Spikes on SHIB’s Price

Historically, SHIB burn events have shown mixed effects on its price. Past analyses from AMBCrypto indicate that even substantial burn rate spikes, like a 6,700% increase observed earlier, often failed to generate lasting momentum. For instance, a recent burn of over 324 million tokens initially sparked optimism but quickly faded as selling pressure resumed. While these burn events have occasionally produced short-term gains, they have rarely sustained upward momentum for SHIB.

SHIB Chart Analysis – Price Action Remains Flat

An analysis of SHIB’s price charts reveals that its price action has remained relatively flat following the recent burn spike. At press time, SHIB traded around $0.00001776, showing limited intraday fluctuations. The Bollinger Bands indicate low volatility, suggesting constrained price movement. Additionally, the RSI sits at 52.5, a neutral level that implies SHIB is neither overbought nor oversold, highlighting a lack of buying momentum necessary to break resistance levels or drive a stronger upward move.

On-Chain Indicators – A Cautiously Bullish Outlook

On-chain data for SHIB presents a mixed yet cautiously optimistic sentiment. Key metrics show mild bullish indicators: "In the Money" increased by 0.81%, concentration rose by 0.06%, and large transactions were up by 2.84%. However, network growth showed a slight decline of -0.23%, signaling limited activity from new addresses. This combination of indicators suggests a cautiously optimistic outlook, though the lack of significant network growth may constrain SHIB’s ability to sustain gains.

In summary, while the recent burn underscores SHIB’s community-driven effort to reduce supply, the lack of substantial buying momentum and new network growth may limit the token’s ability to drive a sustained price rally.

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