Shiba Inu price hit a two-month high of $0.00001519 about a week ago. However, as the crypto market reacts to the Alameda Research crisis, the altcoin dropped to a one-month low to an intraday low of $0.00000929 on Wednesday. Notably, most of the other cryptos such as BTC and DOGE have also recorded a significant plunge .
Alameda Research’s crisis
On Tuesday, news of Binance buying its key rival, FTX heightened concerns over contagion within the broader cryptocurrency sector. This stems from a report released late last week, which showed that Alameda Research’s balance sheet largely comprised of FTT, which is the FTX token. By having billions of the FTT token, the balance sheet is largely illiquid. Sam Bankman Fried, who is the founder of FTX, is the owner of Alameda.
In response to these details, the coin plunged by about 80% on Tuesday. As at the time of writing, it was at $4.42 after dropping from $22 at the beginning of the week. Investors remain concerned on the impact that the sell-off will have on the larger crypto sector based on the positioning of FTX in the market.
To begin with Alameda Research has invested heavily in numerous companies within the industry. Besides, FTX has expanded into a crypto empire worth over $30 billion.
In addition to the FTX crisis, Shiba Inu price will also be reacting to the US CPI numbers set for release on Thursday. The figures will offer further directional cues on the Fed’s monetary policy decision in coming months as well as the overall health of the US economy. An environment of high interest rates and risk aversion has been weighing on cryptos in recent months.
Shiba Inu price prediction
As seen on its four-hour chart, Shiba Inu price continued to trade below the 25 and 50-day exponential moving averages on Wednesday. Granted, it eased on its losses earlier in the day after news of Binance purchasing FTX yielded a plunge in the previous session. Even so, it remains in the oversold territory with an RSI of 20.
Based on both the technicals and fundamentals, I expect SHIB/USD to remain under pressure over the ensuing sessions. Having dropped below the psychologically crucial zone of 0.00001000, the bulls are now striving to defend the support at 0.00000955.
With insufficient buyers to sustain the altcoin above the aforementioned level, the bears will have an opportunity to retest June’s low of 0.00000923.On the flip side, a corrective rebound may have Shiba Inu price hit 0.00001034 before easing to the critical level of 0.00001000.