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Blockchain analytics platform Santiment says that a memecoin which has soared by nearly 400% over the past seven days could be due for a correction.

Santiment points out that the number of Shiba Inus (SHIB) active deposits is extremely high, which suggests a possible reversal in the future.

Yellow flags starting here. Extremely high active deposits are suggesting that its probably a top forming.

The crypto analytics firm says that even though SHIB inflow to exchanges is not very high, it nevertheless hints that a reversal could be imminent.

Its not very high, we would expect to see much higher. But still its suggesting the same, probably a top forming.

Santiment also says that profit-taking by SHIB traders is low, an indication that traders are betting on the price of the memecoin surging even higher. The firm warns that markets often punish this kind of overconfidence.

potential profit-taking from Shiba is still relatively low, not a whole lot yet.

We would notice that 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, its going to pump more. Market tends to punish this sort of confidence.

Shiba Inu is trading at $0.000034 at time of writing, according to CoinGecko. Since the start of the year when the memecoin was priced at $0.000000000077, SHIB has surged by over 440,000%. SHIB is currently ranked 12th by market cap.

Featured Image: Shutterstock/Giovanni Cancemi/Vladimir Sazonov

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