The daily chart for Shiba Inu indicates that the downtrend it has been experiencing may be losing its strength, with analysts predicting a breakout target of $0.00006.
Currently, Shiba Inu finds itself at a critical point after enduring a persistent downtrend since May 4. It is worth noting that earlier this month, SHIB attempted to recover from the price decline that occurred throughout April, resulting in a monthly loss of 27.16%, the highest since the Terra implosion in May 2022.
However, the recovery efforts faced a setback on May 4, leading to further losses. Fortunately, this downward trend came to a halt on May 13 when Shiba Inu retested the lower Bollinger Band after crashing to $0.00002156.
The Bollinger Bands now suggest that SHIB may be preparing for a breakout, which could potentially put an end to this ongoing downtrend. Traders often use the Bollinger Bands to identify overbought or oversold regions, which can be helpful in predicting a possible trend reversal.
When the price of a cryptocurrency drops to retest or break below the lower band during a downtrend, it typically indicates that the asset may be entering oversold territories. SHIB retested this lower trendline during the price collapse on May 13, signaling that the downtrend is weakening.
Interestingly, this retest was followed by a strong recovery for Shiba Inu, supported by Bitcoin’s rebound. However, SHIB faced resistance when it reached the upper trendline, reaching a high of $0.00002588 yesterday. To maintain this upward momentum and eventually break above the upper trendline, Shiba Inu needs further support from the bulls.
Taking a closer look at the daily chart, it is evident that the Bollinger Bands are currently contracting. This significant squeeze indicates reduced volatility, which often precedes a sharp price movement. Data from Santiment shows that Shiba Inu’s volatility has indeed decreased this week.
On May 12, SHIB’s volatility dropped to 0.003097, the lowest in three months. The last time Shiba Inu experienced such low volatility was on February 25, when it reached 0.001892. This decline in volatility was followed by a meteoric surge for Shiba Inu in late February, resulting in a 370% spike to $0.000045 on March 5.
Despite a slight increase in volatility over the past few days, it remains below the daily average. Additionally, market analysts have identified a symmetrical triangle on the daily chart, confirming that Shiba Inu has broken above the upper trendline. This breakout further sets the stage for a significant price increase.
Currently trading at $0.00002429, Shiba Inu is looking for another opportunity to retest the $0.000025 zone. The bulls are hoping to capitalize on the growing accumulation trend from shark and whale addresses to facilitate this much-needed breakthrough. According to The Crypto Basic, these addresses have purchased 4.35 trillion SHIB since March.
Amidst these bullish indicators, some experts predict that Shiba Inu could reach a price of $0.00005. However, market analyst SHIB Knight believes that Shiba Inu has the potential to reach $0.00006 when a trend reversal occurs. This price level would represent a 147% increase from Shiba Inu’s current value.
Disclaimer: This article is for informational purposes only and should not be considered financial advice. The views expressed in this article are solely the author’s opinions and do not reflect the opinion of The Crypto Basic. Readers are advised to conduct thorough research before making any investment decisions. The Crypto Basic is not liable for any financial losses incurred.