Shibarium Reintroduction Spurs a Price Increase for BONE, but Bearish Signs Persist

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Last Updated on August 27, 2023 by Bitfinsider

Shibarium’s Layer-2 (L2) solution for the Shiba Inu (SHIB) ecosystem’s mainnet relaunch on August 24 has caused the price of one of its tokens, Bone ShibaSwap (BONE), to rise. BONE was the top gainer among all cryptocurrencies at the time of writing, according to CoinMarketCap, with a gain of about 20% over the last seven days.

Because to some community members’ restored access to their previously bridged BONE tokens following Shibarium’s relaunch, there has been an uptick in activity surrounding BONE over the last few days.

Due to a significant increase in transaction volume, the L2 network had scalability problems when it first went operational on August 16. A lot of community members momentarily lost access to their BONE tokens due to a malfunctioning bridge that allowed users to transfer tokens from other networks to the Shibarium network.

The Shibarium team identified the bridge’s issue and shut down public access to the network. On August 24, the network was reactivated after the problem had been resolved.

At the time of publication, BONE was trading for $1.38. Despite the surge, analysis of price movements on a daily basis showed that accumulation among day traders had slowed.

There were a few negative divergences between the price of BONE and various important momentum indicators. As an illustration, while the price of BONE increased after Shibarium’s debut, its RSI and MFI trended downward. The token’s RSI was resting on its 50-neutral line when this article went to print. During the same time period, the MFI was situated at 47.51, below its centre line.

Price and indicator divergence demonstrated that strong momentum was not driving the price climb. Typically, events like this are followed by a price adjustment.

The price of BONE increased over the past week, but its CMF decreased and went into negative territory on August 16—a position it has kept ever since. This is a negative indication, which traders typically interpret as a sell signal.

These price differences suggested that the alternative’s price would see a sizeable negative correction after the euphoria surrounding Shibarium’s relaunch subsides in the ensuing days and all previously-bridged BONE tokens have been reclaimed.

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