What Happened: SHIB rose to a four-month high of $0.0000346 on Wednesday after whale investors made several sizeable investments in the preceding days.

According to on-chain and social metrics platform Santiment, the current indicators point to a potential top forming.

Active deposits on Shiba Inu’s network have skyrocketed and that’s bad news for its price.

“Yellow flags starting here. Extremely high active deposits are suggesting that it's probably a top forming,” said the Santiment analysts.

In examining the “network profit loss” metric, they found potential profit-taking is still relatively low. However, upon zooming in they noticed higher price tops are built on lower profit-taking spikes.

“This could potentially indicate that traders are becoming too confident on price action, like 'no need to sell, it's going to pump more.' Market tends to punish this sort of confidence,” said Santiment.

Another yellow flag for SHIB is the whale transaction count. A high number of whale transactions, as seen in the past few days, usually corresponds with a local price top, noted Santiment.

Overall, Santiment concluded a “fair amount of top signals are visible” and classified the token as high risk, low reward.

Price Action: At press time Thursday, SHIB was trading at 0.00002588, gaining 17.60% over 24 hours and the coin had a daily trading volume of $18.6 billion.

Photo by Melody Less on Unsplash