Disclaimer: The findings of the following analysis are the only opinions of the writer and should not be considered investment advice
The meme token has been on a steep decline since hitting its ATH in October last year. Shiba Inu (SHIB) fell even between parallel channels southwards, falling below the vital liquidity range near the $0.033 zone. (SHIB prices are now multiplied by a factor of 1000).
In light of buyers’ previous tendencies to defend the $0.02195-$0.02013 range, SHIB bulls aimed for a retest of the 20 EMA (red) before returning to a long-term downtrend .
At going to press, SHIB was trading at $0.022.
SHIB Daily Chart
During this bearish phase, SHIB lost its crucial Point of Control (red, POC) near the $0.033 level and also dropped below its 200 EMA (yellow). In addition, this level coincided with the Fibonacci resistance of 23.6%. The bulls took the lead on the $0.02 mark which they held for more than four months.
As a result, the price entered a tight phase as the bulls began to build pressure and rejected lower prices. Thus, it saw more than 70% gains from February 3-9 and broke out of the down channel while the 23.6% level remained strong. Over the past month, SHIB has formed a falling wedge (reversal pattern) on the daily chart. But when the 20 EMA fell, it dipped below the 200 EMA (yellow). The bears clearly had an advantage.
If history repeats itself in the future, the bulls would be eager to keep the $0.02-$0.021 range intact. Thus, we are keeping the hopes of a recovery alive towards the USD 0.024 level. Also, traders should keep a close eye on the narrowing gap between the 50 EMA (cyan) and the 200 EMA. If they undertake a bearish crossover (death cross), a major sell-off may be lurking.
The bearish RSI was aiming for a close above the 43-45 resistance range. Interestingly, while price action has continued to mark lower troughs over the past three weeks, the RSI held the 39 support intact. This revealed a bullish divergence. Also, the OBV maintained its immediate support, while the price diverged in the south.
In addition, the DMI lines flashed a bearish bias but flashed increasing buying influence. In addition, the ADX still portrayed a weak directional trend for SHIB.
Overall, a reading of the technical indicators suggested there could be a near-term rebound towards its 20/50 EMA. After this, the alt could continue to reverse in its long-term downward trend.
Additionally, the alt shares a 69% 30-day correlation with Bitcoin. Therefore, it would be essential to keep an eye on Bitcoin’s movement with general market sentiment in order to make a profitable move.
This post Shiba Inu: Everything you need to know about the next buying opportunity
was published first on https://ambcrypto.com/shiba-inu-all-you-need-to-know-about-the-next-buying-opportunity/