As a seasoned crypto investor with a knack for recognizing market trends and patterns, I find myself both concerned and intrigued by the current state of Shiba Inu (SHIB). The recent 4% drop to $0.00001342 on Sunday, coinciding with Bitcoin’s dip below the $60,000 support level, has set off renewed selling pressure across altcoins, including SHIB. This correction, which seems to have reversed Shiba Inu from multi-month resistance, could potentially signal a more significant bearish reversal ahead.
On Sunday, I witnessed a 4% plunge in Shiba Inu‘s price to $0.00001342, mirroring Bitcoin‘s fall below the crucial $60,000 support level. This downward momentum intensified, causing ripples across other significant altcoins. Given Shiba Inu’s volatile and speculative trading character, the meme cryptocurrency sector was not immune to these effects. The sell-off seemed to have pushed SHIB back from a prolonged resistance point, hinting at potential risks of a more substantial correction in the near future.
Shiba Inu Price Set for Bearish ReversalÂ
As a seasoned cryptocurrency investor with over a decade of experience in the digital asset market, I’ve seen my fair share of bull and bear markets. In my perspective, the Shiba Inu price action this week has been quite typical of a consolidation period. This coin seems to be struggling to break through the $0.000014 resistance level, which isn’t surprising given the current market conditions.
Today’s Shiba Inu price fails again at breaking through the upper trendline, with a large red candle signaling strong resistance from sellers. Surprisingly, the selling pressure continues even after 40 million SHIB were burned within the last 24 hours, causing a massive 3500% increase in the burning rate.
Generally speaking, a big burn (destruction) of tokens from circulation might help maintain price stability or even cause it to rise. Yet, the current downward correction trend indicates that market conditions are more influential than the burn’s effect, keeping the price in check and potentially leading to further declines.
The Open Interest of Shiba Inu has significantly decreased during August, going from $37 million to $23.2 million – a decrease of about 37%. According to Coinglass, this substantial drop in Open Interest could indicate less market involvement or liquidity for SHIB, possibly suggesting that investor confidence may be dwindling.
Consequently, this adjustment could potentially boost the Shiba Inu’s price up to 30%, aiming to touch the $0.0000095 mark again at the level of the wedge pattern support.
The meme coin based on dogs is currently trading below its daily Exponential Moving Average, suggesting that the easiest direction for it to move might be downward.
The two trendlines in a falling wedge pattern are coming closer together, suggesting that the downward pressure on Shiba Inu’s price is decreasing. As a result, there may be an upcoming breakout in the price, which might serve as the first clue of a potential shift in trend direction.
The Relative Strength Index (RSI), which had dropped to an oversold level, rose to 35%, highlighting a strong demand as prices were relatively low.
The post-breakout rally may push the asset 50% to hit $0.00002.
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2024-08-12 00:42