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Shiba Inu (SHIB) Nears Yearly Low: What’s Next for the Meme Coin?

Picture Source: BeInCrypto

Shiba Inu (SHIB), the popular meme cryptocurrency, has been on a downward trajectory since August, approaching its yearly low. Notably, SHIB’s price has fallen below the critical $0.0000080 horizontal support level that had held for over a year. In this analysis, we’ll explore the recent price trends and the potential future scenarios for Shiba Inu.

A Persistent Downtrend:

Shiba Inu’s price decline began after facing rejection from a long-term descending resistance trendline that had been in place for 427 days. During this bearish movement, SHIB dropped below the significant horizontal support level at $0.0000080, which had consistently provided support for over a year. Typically, when a support level is breached, the price is expected to retest it and confirm it as a new resistance. However, in this case, SHIB continued its descent without the anticipated retest.

Bearish Momentum Indicators:

The Relative Strength Index (RSI), a crucial momentum indicator, reveals a bearish sentiment for SHIB. The RSI’s readings above 50, along with an upward trend, typically indicate a bullish market, while readings below 50 suggest the opposite. In this scenario, the RSI was rejected at the 50 level in August and is currently following a downward trajectory.

Uncertain Daily Trends:

Analyzing the daily timeframe does not provide a clear confirmation of SHIB’s trend direction. Since August 14, the Shiba Inu price has been moving downward within a descending parallel channel. Although it experienced a bounce at the support line of the channel in September, it faced rejection near the channel’s resistance line on October 2, resulting in a declining phase.

The RSI on the daily chart also failed to breach the 50 level, indicating a bearish sentiment.

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Potential Future Scenarios:

Considering these factors, the most probable scenario for SHIB is a potential 9% decline towards the support line of the channel, which is currently located at $0.0000065.

However, it’s essential to note that a breakout from the channel could signal a bullish trend. In such a scenario, a 33% increase to the next resistance at $0.0000095 becomes a possible future price movement.

Conclusion:

Shiba Inu (SHIB) has faced a significant downturn, breaching a long-standing support level and battling a bearish trend. While a potential further decline is on the horizon, a breakout from the descending channel could shift the momentum in favor of SHIB. The meme coin’s price remains highly dynamic, and investors should closely monitor its movements and be prepared for possible trend reversals.

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