16 May 2024
The Shiba Inu (SHIB) price has exhibited a notable increase, rising by 6.5% in the last 24 hours and 12.5% over the past week, marking a significant shift towards bullish momentum. Technical analysis of the daily SHIB/USD chart reveals a descending trend line where price has been rejected on every single daily close for the past two months.
However, today’s price movements have led to a shift. The descending trend line that previously governed Shiba Inu’s downward trajectory has recently been breached, suggesting a potential reversal or at least a weakening of the bearish pressure. Renowned crypto analyst Cold Blooded Shiller remarked, “One of the commandments of memes is thou shalt always long the meme when the trendline snaps.”
One of the commandments of memes is
thou shalt always long the meme when the trendline snaps pic.twitter.com/iPDpuX46ZH
— Cold Blooded Shiller (@ColdBloodShill) May 4, 2024
Prior to the breakout, he noted, “In 20IQ szn you’re looking for 20IQ entry signals. Breaking the trendline that has been respected on every single daily close for the past 2 months will be one of those. SHIB starting to tick.”
The shift is supported by the positioning of Exponential Moving Averages (EMAs); the 20-day EMA at approximately $0.00002238 and the 50-day EMA at $0.00002131 which were both breached with yesterday’s daily close.
Further down, the 100-day and 200-day EMAs at around $0.00001831 serve as significant support zones, indicating strong buy levels should any major retracement occur. The interaction of price with these EMAs in the coming days will be crucial in determining the sustainability of the current breakout.
The application of Fibonacci retracement from the recent peak to the trough are also illustrating a pivotal development for Shiba Inu’s price action. The 0.236 Fibonacci retracement level at $0.00002483, recently surpassed in yesterday’s trading session, now serves as a critical support in the short term.
This level’s importance is accentuated by its role in confirming the legitimacy of the recent breakout from the descending trend line—a breakout that might otherwise be dismissed as a mere technical anomaly or ‘fakeout.’
Currently, a retest of this $0.00002483 level as support is underway. A closure of today’s daily candle above this mark would solidify the argument for a more sustained upward trajectory in SHIB’s price. Such a close would reinforce investor confidence that the breakout is genuine and that the market sentiment may be shifting more firmly to the bullish side.
If SHIB’s price remains steadfast above this newfound support, the immediate subsequent target would be the $0.00002882 level, correlating with the 0.382 Fibonacci retracement. A breach of this resistance would likely set the stage for further gains towards $0.00003205 and $0.00003527, the 0.5 and 0.618 Fibonacci retracement levels, respectively.
Reaching the 0.618 level, often referred to as the ‘golden ratio,’ could potentially yield a substantial 40% gain from current prices, offering a lucrative scenario for investors closely monitoring these technical cues.
The heightened trading volume (+30% in the last 24 hours) underlines active participation in the market, crucial for supporting the legitimacy of the breakout. Alongside, the Relative Strength Index (RSI) at 55.05 indicates that the asset is neither overbought nor oversold, leaning towards a neutral to slightly bullish position. This provides room for upward movement without immediate concerns of entering overbought territory.
Overall, with the recent breakout above the descending trend line, Shiba Inu’s price action invites a bullish outlook, suggesting that the downtrend may be losing its grip. The key for traders will be to watch for a daily close above $0.00002483. A confirmed hold above this level could pave the way for further ascents towards higher Fibonacci levels.