As a researcher with extensive experience in analyzing cryptocurrency markets, I find the current situation surrounding Shiba Inu (SHIB) particularly intriguing. The memecoin’s price action has been in a technical tug-of-war between bears and bulls, with a descending triangle formation looming on its 3-day chart.
The cost of SHIB, referred to as the “Dogecoin challenger,” has become a battleground between bears and bulls. Bears aim to drive it downward while bulls hold onto optimistic indicators. Experts closely examine the chart trends and on-chain information of this meme coin to forecast its future direction.
Descending Triangle Looms: Will SHIB Fall Or Fly?
On SHIB‘s three-day chart, a descending triangle pattern has appeared. This configuration usually signals an upcoming price decrease as the asset is compressed between converging support and resistance lines. For SHIB investors, it remains to be seen whether the price will breach the support level and plummet further or shatter the triangle’s boundaries, leading to a potential uptrend.
Falling Demand Raises Concerns For Shiba Inu
Dampening optimism, Shiba Inu (SHIB) has experienced a substantial decrease in interest. According to Santiment’s findings, the number of daily active addresses for SHIB has fallen by over 50% within the last month. This indicates a dwindling community and likely less trading activity, which could contribute to a bearish price trend.
New Investors Give SHIB The Cold Shoulder
The downturn in morale is worsened by the significant drop in the number of new addresses signing up to trade SHIB daily. Based on on-chain statistics, this figure has plummeted by approximately 51% within the same timeframe. The absence of new participants entering the market might intensify the selling pressure.
SHIB’s High Valuation: A Recipe For Sell-Off?
The Market Value to Realized Value (MVRV) ratio of SHIB is currently elevated at 38%, implying that the market price for this token is significantly higher than the average cost at which it was bought by its holders. This condition can lead to profits realization among existing investors, potentially causing them to sell off their tokens and further exacerbating downward price pressure.
A Silver Lining?
In contrast to the widespread pessimistic viewpoint, SHIB exhibits a faint sign of optimism. The coin’s mood index has unexpectedly brightened, suggesting a change in investors’ outlook. This newfound positivity might lead to a surge in price, contradicting the bearish forecast suggested by the descending triangle formation.
Related Reading: Bitcoin Update: $120 Million Futures Liquidated As Price Takes A Beating
Can Bullish Sentiment Propel SHIB To Higher Ground?
Should the favorable opinion continue, experts anticipate a significant price increase for SHIB, potentially rising to $0.00003. This upward trend would bring relief to investors following a period of price decline.
While examining SHIB‘s Fibonacci retracement levels, it appears that the memecoin could experience a potential 15% decrease in price, reaching a minimum of $0.000018, should bears persistently drive down the market and cause a breach of support.
As an analyst, I would express it this way: I’m now more worried as an investor in Shib, as this latest development serves as a reminder of the potential consequences should the market take a bearish turn.
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2024-05-04 12:04