Bitcoin
Analyzing the SHIB price relationship with Bitcoin and Ethereum
The data shows that the Shiba Inu price has closely tracked Bitcoin price movements more than any other asset, with SHIB and BTC boasting the largest price correlation matrix over the last 30 days.
Shiba Inu (SHIB) has been both a beneficiary and a victim of broader market trends, depending on their direction. When the market registers an upward trend, Shiba Inu usually register price increases. However, during a market downtrend, SHIB witnesses substantial declines.
Shiba Inu tracks Bitcoin
This pattern has prevailed throughout this year, with a notable impact in late April. Bitcoin fell 15% from a high of $66,000 on April 23 to a low of $56,000 on May 1. This value represented the lowest Bitcoin price in three months.
Interestingly, Shiba Inu has followed a similar path, having fallen from a high of $0.00002689 on April 23rd to a low of $0.00002057 on May 1st. This marked a 23.5% drop in the same period that Bitcoin recorded similar downward pressure. The price drop witnessed by Shiba Inu and Bitcoin is a product of their strong correlation.
Shiba Inu price correlation with BTC
Market data provided by IntoTheBlock shows that Shiba Inu has a 79% correlation with Bitcoin over the last 30 days. This indicates that Shiba Inu price movements had a strong positive correlation with Bitcoin price movements. In contrast, Cardano (ADA) it only has a 62% correlation with Bitcoin in this period.
While this trend may be positive for Shiba Inu, it also paints a worrying picture. For example, if Bitcoin faces turbulence due to market headwinds, SHIB will likely not buck the general market trend. This is seen in the recent price action where Shiba Inu fell along with BTC.
Bitcoin faced major resistance at the $70,000 level yesterday, resulting in a drop to $68,000. This drop impacted the price of the Shiba Inu, worsening the existing downward pressure it already faces. SHIB has recorded six consecutive days of losses since May 30, down 6.17% this month.
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Basic encryption previously confirmed that Shiba Inu has a history of recording losses in June. Notably, Bitcoin has not recorded as many losses as Shiba Inu during the ongoing crisis due to its greater resilience. SHIB typically exhibits higher volatility. As a result, during market declines, it faces steeper declines.
However, this also means that Shiba Inu witnesses higher price increases during an uptrend. For example, SHIB increased 370% between the end of February and the beginning of March to $0.000045. Meanwhile, Bitcoin only saw a 33% increase in that period.
Shiba Inu Price Poised to Follow BTC Rise
SHIB’s high correlation with BTC is a generally positive sign, especially with Bitcoin poised to reach greater heights. As a result, analysts who projected high BTC prices for this market cycle also believe that Shiba Inu would record higher rallies. Market analyst Armando Pantoja wait SHIB will reach $0.001 when BTC reaches $100,000 to $250,000.
Meanwhile, Shiba Inu only has a 69% price correlation with Ethereum (ETH) and a 73% correlation with Dogecoin (DOGE). SHIB currently trades for $0.00002383, with its Accumulation/Distribution metric indicating a sharp drop in investor holdings, having fallen from 28 trillion SHIB on May 28 to its current value of 12.6 trillion.
Disclaimer: This content is informational and should not be considered financial advice. The opinions expressed in this article may include the personal opinions of the author and do not reflect the opinion of The Crypto Basic. Readers are encouraged to do thorough research before making any investment decisions. Crypto Basic is not responsible for any financial losses.
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