Shiba Inu (SHIB) took the world by storm earlier this year with its staggering rally that started at the beginning of the year. SHIB’s price skyrocketed to a local high of $0.00001575 on February 5, 2023, after which it entered a long-term downturn. Despite the beta launch of Shibarium, a blockchain-based platform that allows developers to create decentralized applications, and an increase in monthly burn rates, the price has failed to recover. Currently trading at $0.00000804, SHIB is in a critical window of opportunity that could potentially determine its future.
A glance at the 1-day chart reveals that after the price reached $0.00001575, it formed a descending triangle with a horizontal trend line at $0.000010 serving as support. This price level also aligned with the 23.6% Fibonacci level. Once the trend line was broken, the price dramatically plummeted, and all year-to-date gains were wiped out.
However, Shiba Inu’s price is currently exhibiting a triple bottom chart pattern, which may be the last hope for a trend reversal. The price area at $0.00000776 served as the last support in mid-June 2022, late December 2022, and now again. Shiba Inu meets all three characteristics of the chart pattern. The three lows must be roughly equal in price and spaced apart by a certain distance, which is the case for June and December 2022, and June 2023. Second, volume must be decreasing throughout the pattern, which is a sign that the bears are losing strength. Considered in the context of SHIB’s trading volume, this condition is also being met. Finally, Shiba Inu has been in a steady downtrend with lower highs since the all-time high of late October 2021. This triple bottom chart pattern may be the critical point at which a trend reversal occurs.
A resistance to be breached is at $0.0000817, and if successful, the 50-day Exponential Moving Average (EMA) currently at $0.00000907 could come into focus. The 23.6% Fibonacci level at $0.000010 is probably the most crucial resistance to confirm a fake breakout.
The bullish case of Shiba Inu is supported by a potential bullish divergence of the Relative Strength Index (RSI) in the 1-day chart. It is observed when the RSI indicates an oversold condition, followed by a higher low associated with lower price lows. The RSI of Shiba Inu price in the 1-day chart could indicate bullish momentum. The break above the oversold zone in recent days could be a signal for a new buy position. But the bearish case is still strong as well.
SHIB traders would not want to see the price drop below $0.00000716 at any cost. If that happens, it would be an alarming signal that SHIB could test the September 2021 low around $0.000006.
In conclusion, Shiba Inu’s price is at a critical point in its young history. If the triple bottom chart pattern plays out and the price breaches through resistance levels, a trend reversal could be on the horizon. However, if the price falls below critical support levels, it could continue to spiral downwards. The future of SHIB remains to be seen, and only time will tell how the market will respond to the current situation.
