Key Takeaways:
- The memecoin Shiba Inu skyrocketed in Oct to gain nearly 400% before prices pared.
- SHIB has formed a bearish pattern on its 4-hour charts.
NEW DELHI (CoinChapter.com) — Shiba Inu, the memecoin named after the Japanese dog breed, seems to be moving towards massive corrections. The forecast comes from technical price patterns that SHIB plotted on its 4-H chart.
The memecoin, which brands itself as the ‘doge killer,’ had a blistering run to its 2021 high as it entered Oct. However, prices soon pulled back, and the meme token entered a bearish pattern called a descending triangle. Though SHIB invalidated the triangle pattern, price charts indicate the formation of a super bearish pattern.
Shiba Inu prices entered a descending triangle pattern after prices pulled back on Oct 7. In detail, a descending triangle pattern is a bearish chart pattern. A trendline connecting a series of lower highs and a horizontal trendline connecting a series of lows forms this pattern.
When a token breaks below the lower trendline of a descending triangle, it might fall to a level equal to the triangle’s height. In SHIB’s case, the memecoin broke above its bearish descending triangle setup. However, the memecoin’s price newfound upwards momentum has resulted in another bearish pattern.
SHIB Price Charts
As the chart shows, SHIB’s prices are now moving in a rising wedge pattern. Two converging trend lines that connect a price series’s respective highs and lows form a rising wedge pattern. It is a bearish pattern that can either be a continuation or a reversal pattern.
Unfortunately, SHIB’s rising wedge is a reversal pattern, sloping up with the prevailing trend. Thus, once Shiba Inu prices fall below the lower trendline of the rising wedge, it risks re-entering the descending triangle formed earlier.
If such a move happens, it would indicate SHIB’s recent bull run was a fake breakout. Re-entry inside a descending triangle would increase SHIB’s chances of breaking below the triangle support. If the triangle support fails, the resulting downtrend would be equal to the height of the triangle.
Thus, SHIB might fall to $0.000011 near its 200-day Moving Average if it breaks below the triangle support.
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Meanwhile, SHIB has immediate support near its 26-day Exponential MA line at $0.000027. If the memecoin breaks below the level, SHIB will find support at $0.000026, with further support near its 50-day MA line at $0.000024. A breach below this support would mean entering the descending triangle.
On the other hand, SHIB has immediate resistance at $0.000029, followed by resistance at $0.000030 and $0.000032.
Trend-based momentum oscillator MACD is now bearish for Shiba Inu. Bars on the MACD histogram, which plots the difference between the MACD line (difference of 12-day and 26-day EMA) and its signal line (9-day EMA of MACD), have turned negative, indicating the MACD line has moved below its signal line, forming a bearish crossover.
Further, the relative strength index is neutral for Shiba Inu, clocking a value of 54.74.
Other SHIB Updates
A non-crypto-related tweet by billionaire Elon Musk propelled Shiba Inu’s bull run. Furthermore, anonymous whale(s) buying close to 6 trillion SHIB started a FOMO buy campaign that increased prices. However, Crypto veterans were skeptical of the token’s rise, highlighting that no strong fundamentals support the price.
Also Read: Could Robinhood add Shiba Inu to its service portfolio? It better shouldn’t.
However, Shiba Inu plans to enter the NFT sector in the next few weeks, as the memecoin plans to 10,000 NFTs representing various ‘lovable creatures.’. Shiboshis is the name given to these NFTs.
Initially, the SHIB NFTs would only be available on its decentralized exchange, ShibaSwap, where buying and trading would be free except for gas prices. In addition, for the first 24 hours, users can only use LEASH, another token in the Shiba ecosystem. After 24 hours, ETH purchases would also be available.
The first 3,000 Shiboshis will cost 0.1 ETH equivalent of LEASH tokens, with the next 5000 costing 0.2 ETH. The remaining would cost 0.3 ETH, with a single wallet allowed a maximum of 10 Shiboshis.
At the time of writing, SHIB was trading at $0.00002838, down 1.46% on the day.
