Popular meme cryptocurrency Shiba Inu extended its losses for a third consecutive trading session on Friday, testing technical breakdown levels below its 50-day Exponential Moving Average (EMA) at $0.00000466. A combination of cooling network activity, a collapsing token burn rate, and broader macroeconomic hesitation has left the altcoin vulnerable to a potential price breakdown exceeding 10 percent.
Token Burn Rate Collapse Dampens Market Momentum
On-chain metrics reveal a severe slowdown in Shiba Inu supply reduction efforts. Only 6.62 million SHIB tokens were destroyed on Thursday, marking a steep decline from the 97.16 million tokens burned on Saturday. This abrupt drop in burn activity removes a key catalyst that previously supported market sentiment, leaving circulating supply reduction stagnant during a critical period of market weakness.
Futures Market Data Exposes Bullish Vulnerability
Data from derivatives tracker CoinGlass highlights ongoing fragility among leveraged traders. SHIB futures Open Interest (OI) remained relatively stable near $43.53 million over the past 24 hours. However, liquidation figures show a clear imbalance favoring sellers: long liquidations totaled $172,390, heavily outpacing short liquidations of just $17,670.
Retail sentiment has also displayed considerable volatility. The funding rate rebounded to 0.0059% on Friday after dipping into negative territory at -0.0013% the previous day, underscoring indecision and shifting expectations among retail participants.
Legislative Delays in US Senate Weigh on Crypto Risk Appetite
Macroeconomic uncertainty continues to damp appetite across speculative asset classes. The US Senate announced a delay in the floor vote for the Crypto CLARITY Act, pushing the deliberation to next month as lawmakers prepare for summer recess starting Monday. Historical trading patterns show that meme coins are typically among the first digital assets to experience aggressive selling when broader market risk aversion sets in.
Technical Indicators and Key Price Targets
Following a loss of nearly 5% on Thursday, Shiba Inu struggled to regain ground on Friday. The Relative Strength Index (RSI) on the daily chart registered at 49, dipping below the neutral midline to reflect diminishing bullish momentum.
If buyers manage to defend the 50-day EMA support zone near $0.0000046, a potential relief rally could push prices toward the 100-day EMA target at $0.00000498. Further bullish extension would encounter major resistance at the 50% Fibonacci retracement level of $0.00000538. Conversely, a confirmed breakdown beneath current support opens the door for a slide greater than 10%.
Performance Across the Wider Altcoin Landscape
The broader altcoin ecosystem presented a mixed picture alongside Shiba Inu's decline
- Ondo (ONDO): Dropped over 2% on Friday, compounding Thursday's 4% slump. The legislative pause on the CLARITY Act weighed heavily on demand, triggering declining Open Interest, negative funding rates, and a strengthening bearish technical setup.
- Ethereum (ETH): Traded sideways around $1,901 on Friday, signaling potential consolidation ahead of a breakout. Steady Exchange Traded Fund (ETF) inflows and sustained accumulation by large holders suggest underlying institutional support remains intact.
- Bitcoin (BTC): Held steady above $64,000, with immediate upside resistance capped by its 50-day EMA at $64,637.
- Cardano (ADA) & LayerZero (ZRO): Both tokens retained gains from Thursday's rebound, outperforming major altcoin peers over the 24-hour period.
