Shiba Inu faces a liquidation risk of 50 million USD

Shiba Inu (SHIB) has fallen significantly over the past week, causing a pessimistic sentiment among investors. This has led to a wave of selling pressure in the market.

However, if SHIB recovers, it could cause significant losses for those investors participating in shorting this memecoin.

SHIB investors need to pay attention

The liquidation map shows a notable development: if Shiba Inu (SHIB) recovers the recent 10% loss, over 52 million USD in Short positions could be liquidated. Short sellers are betting on a fall, but if SHIB bounces back, they will face heavy losses.

When short positions are closed due to losses, the market will witness a surge in buy orders, thereby pushing prices higher. This is particularly beneficial for SHIB holders, especially when this altcoin manages to regain upward momentum, reinforcing a positive outlook for the token.

Shiba Inu liquidation map | Source: CoinglassHowever, the signals in the overall market indicate some concerns. The number of active addresses of Shiba Inu has fallen by 36% in the past 48 hours, suggesting that investors are losing confidence in the rapid recovery ability and are exiting the market.

This decline reflects a lack of short-term confidence. As more and more investors withdraw, buying pressure is necessary to trigger a recovery.

The number of active addresses of Shiba Inu | Source: Glassnode## SHIB needs to break through the resistance level

At the moment, SHIB is trading around $0.00001413, just below the resistance level of $0.00001435. This memecoin is facing mixed signals.

The important resistance level $0.00001435 needs to be broken for SHIB to recover.

If the price continues to fluctuate within the accumulation range from $0.00001317 to $0.00001435, traders will remain safe from liquidation risks. The sideways action will keep this altcoin in a neutral zone, avoiding strong price fluctuations in the short term.

Shiba Inu Price Analysis | Source: TradingViewHowever, if it surpasses the resistance level of $0.00001435 and turns this level into support, SHIB has the potential to rise back to $0.00001553, marking a 10% recovery, dismissing the current bearish sentiment and opening up a more optimistic outlook for this altcoin.

Vincent