Shiba Inu's price has been sealed in a descending channel band since June 3. Therefore, unless SHIB price can overcome the channel’s magnet effect, it will test the May 19 low and possibly extend the declining channel that originated on May 10.
Since June 3, SHIB price has trended lower in a descending channel reaching a 40% decline for SHIB on June 8. However, it is interesting to note that the trade volume underpinning the descending channel has been sporadic, revealing there is no stampede for the exits, despite the weakness. In fact, today’s four-hour trade volume bars barely exist.
For some time, the limited SHIB trade volume validated the view that the soft descent was a function of the broader weakness in the cryptocurrency complex. Still, the SHIB price correlation coefficient with BTC has quickly turned negative over the past two days. The negative price correlation hints that Shiba Inu's price has decoupled from the broader market and is driven by the governing descending channel.
It will take a compelling upside release from the descending channel to drown the skepticism that the current SHIB price structure provokes. Immediate support level materializes at the May 19 low of $0.00000607, followed by the channel’s midline, currently at a price of $0.00000572. After that, a deeper decline could reach the channel’s lower boundary at a price of $0.00000485, realizing a 25% decline from the current price.
If the Shiba Inu does unlock from the channel, there is no immediate resistance for SHIB price until the symmetrical triangle pattern apex line at $0.00000757. The level provided support in May and created a resistance level earlier this month. A successful close above the line could extend the SHIB price rally to the 50 four-hour simple moving average at $0.00000788.
For aggressive market operators, look for a close above the average to target a price rally to the June 2 high of $0.00001048, generating a 60% gain from the current SHIB price.
A heightened level of uncertainty accompanies rookie cryptocurrencies as price history is too limited to define Shiba's outlook confidently. Instead, investors are better served to realize that they are the creation of social media hype and the resulting fear of missing that convinces retail investors of staggering returns.
Interestingly, Google Trends shows that SHIB and Shiba Inu's search interest is 10% of the May 11 peak and is resting at the lowest level since the peak. Thus, it is difficult to rally a new cryptocurrency without retail interest because institutions are not buying SHIB.
Shiba Inu's price sits at a pivotal moment in its short-term history. How it resolves the SHIB price descending channel and manages the May 19 low will dictate the price structure for many weeks.
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