Recently, Santiment, a prominent cryptocurrency analytics platform, has shed light on a noteworthy development in the crypto market. According to their analysis, traders of Ethereum (ETH), Shiba Inu (SHIB), and Sushiswap (SUSHI) exhibited signs of mild panic on the previous day.
📉 #Ethereum, #ShibaInu, and #Sushiswap traders showed some mild signs of panic yesterday, and their networks showed some of the highest levels of trader loss taking (vs. profit) all year long. These are typically signs of a short-term rebound opportunity. https://t.co/lz6NsiH62o pic.twitter.com/HWzWvM5RHz
— Santiment (@santimentfeed) October 6, 2023
These panicky sentiments were accompanied by a surge in trader losses, which, compared to profits, reached some of the highest levels witnessed throughout the year. Analysts often interpret this combination of trader anxiety and substantial losses as a potential indicator of a short-term rebound opportunity in the crypto markets.
Analyzing Ethereum & Shiba Inu Performance
Crypto analyst Gert van Lagen took to Twitter to share insights on Ethereum’s current situation. According to his analysis of the one-month chart ($ETH [1M] – EW), Ethereum encountered a strong impulse that was halted at the red 200-week Exponential Moving Average (EMA).
Following a sharp correction, a momentum impulse broke the 200-week EMA. The subsequent phase was identified as an Expanded Flat correction, finding support at the 200 EMA. Looking ahead, the analysis suggests a third blow-off impulse targeting a price range between $7800 and $14000. Additionally, there is anticipation of a breakout from a blue ascending triangle.
On a different note, a report by JPMorgan revealed that the increase in Ether staking after the Merge and Shanghai upgrades has cost Ethereum. The network has experienced higher centralization, and the overall staking yield has declined.
Shiba Inu has recently exhibited a remarkable 485% dominance on the buying side, as revealed by the Bid-Ask Volume Imbalance. This metric gauges the disparity between the volume of buy orders (bids) and sell orders (asks) in the order book. A 485% imbalance strongly suggests an overwhelming buying pressure compared to selling pressure.
Despite the significant imbalance favoring bulls, analysts caution against hasty investment decisions based solely on this metric. The Bid-Ask Volume Imbalance is recognized as a volatile indicator susceptible to rapid changes. Factors, including market sentiment and potential manipulation, could contribute to such high imbalances.
Consequently, investors should approach this data cautiously and consider other factors before making investment decisions. Imbalance signals Shiba Inu’s buying interest at the current price but isn’t a sure sign of imminent reversal.