Crypto and forex analyst, World of Charts, predicts that Shiba Inu (SHIB) could experience a significant spike of 120% once it breaks out of its consolidation phase. With SHIB already up 10.94% this month, market sentiment has shifted from bearish to bullish as investors anticipate a recovery from the 27.16% loss suffered in April. This loss marks SHIB’s largest monthly decline since May 2022 when it dropped 41.82% due to the collapse of the Terra ecosystem.
World of Charts recently conducted an analysis revealing that SHIB is currently consolidating within a bullish flag pattern on the 8-hour chart. This flag pattern emerged after SHIB dropped from its yearly high of $0.00004567 on March 5, signaling the start of its downward trend.
The bearish consolidation phase that followed saw SHIB experience intermittent declines and form a downward channel characterized by lower lows and lower highs. World of Charts highlights this trend, emphasizing that the channel represents SHIB’s bull flag pattern. Typically, a bull flag pattern occurs after a significant price surge and indicates a temporary pause before the rally resumes. Based on this premise, World of Charts projects an upcoming breakout for SHIB.
The analyst predicts that once SHIB breaks above the downward sloping channel, there will be a further push towards recovering previous highs, with a target of 120%. This would result in SHIB reclaiming $0.00005434, leading to a new yearly peak.
The current momentum of SHIB suggests that the anticipated breakout could be imminent, given the double-digit monthly gain. The tightening of the Bollinger Bands on the daily timeframe, observed from February 25 to 26, mirrors the pattern that preceded the late February rally. This indicates the potential for a similar price upsurge for SHIB.
At its current position, SHIB’s immediate goal is to establish a strong position above the 20-day EMA at $0.00002426. Currently trading at $0.00002474, SHIB’s bulls need to push towards reclaiming the upper Bollinger Band at $0.00002753 to solidify the short-term bullish momentum.
Coinglass data confirms that while SHIB has experienced a 3.38% decline in derivatives volume, Open Interest has increased by 13.3% to $64.83 million over the past 24 hours. This surge in Open Interest is accompanied by a rise in long positions, indicating growing confidence in SHIB’s recovery.
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