SHIB's Rally Exposes Structural Flaws as Token Burns Drive Price Swings

Shiba Inu (SHIB) has experienced a resurgence in bullish activity, with its value climbing to $0.00001034 at the time of writing. This uptick is fueled by a rebound in market capitalization and community-driven token burning campaigns, according to

. Technical analysis points to a breakout on the weekly timeframe, as SHIB’s price moves above significant Fibonacci retracement levels, notably the 1.272 extension at $0.000185406. In the near term, momentum remains favorable, with the token trading above the 9-period EMA at $0.00001020 and the Stochastic RSI indicating a possible move toward $0.0000110–$0.0000115. Still, experts warn, as noted by , that overbought signals could lead to a short-lived correction before any further rally.

SHIB’s latest rally has been supported by decentralized burning efforts, where community members buy

on the open market and send it to a burn address. These activities are in line with SHIB’s decentralized philosophy, as no central authority oversees the burning process. Nonetheless, some fundamental issues remain. Shibarium, the project’s layer-2 network, has struggled to gain momentum, with its Total Value Locked (TVL) staying under $1 million since early October, based on data from . This persistently low TVL points to a significant lack of utility, as both developers and users have yet to embrace the platform at scale, challenging SHIB’s long-term deflationary ambitions.

Opinions in the market are mixed. Optimists believe that continued buying could propel SHIB to the $0.0000110–$0.0000115 range, while skeptics caution that a breakdown in support could trigger a drop of up to 25%. On shorter timeframes, SHIB is consolidating within a tightening symmetrical triangle, facing resistance just below the 50-EMA at $0.00001026 and downward trendlines from October peaks. Should the price fall below the 0.382 Fibonacci level at $0.00001022, it may find stronger support at $0.00000956.

SHIB’s price recovery is further complicated by structural challenges. With a circulating supply nearing 589 trillion, the token faces significant supply pressure that deflationary tactics struggle to offset. Some analysts argue that SHIB’s ecosystem does not provide enough utility to support lofty price goals such as $0.0001, describing it as a “dead end road.” Meanwhile, investor interest is shifting toward sectors like AI compute and DePIN projects, which are seen as offering more practical value.

The community’s determination remains a positive factor. Recent statistics revealed a 42,000% jump in SHIB tokens burned within a single day, briefly pushing the price up to $0.00001062. However, this dramatic increase highlights SHIB’s volatility and dependence on short-term excitement rather than steady growth. For SHIB to overcome its underlying issues, developers need to deliver tangible utility on Shibarium to attract both liquidity and developer participation.

As the market looks for direction, SHIB’s future will depend on balancing the enthusiasm of its community with the realities of its technical and structural situation. A sustained move above $0.0000110 would challenge investor conviction, while a loss of momentum could see the token revisit key support levels.