Shiba Inu Price Approaches Yearly Lows Amid Market Volatility

Shiba Inu Price Approaches Yearly Lows Amid Market Volatility

Recently, Shiba Inu (SHIB) came close to touching its lowest levels of the year during a market downturn. Although Bitcoin’s subsequent recovery lifted the overall crypto market, fresh analysis suggests that SHIB and other digital assets could face further declines in the days ahead. Shiba Inu broke down from a falling wedge pattern—an unusual event typically indicating severe bearish pressure. Despite a brief recovery, SHIB’s price action remains weak, with a potential 16% decline from its current level.

Shiba Inu Price Rejected at Key Levels

Shiba Inu is currently trending downward, having been confined within a falling channel that underscores its bearish momentum. On August 3, the price broke down from the falling wedge, a rare occurrence as these patterns usually suggest a bullish reversal might be on the horizon.

Support for SHIB has been found around $0.000012, with a stronger support level at $0.00001. Conversely, immediate resistance lies at the 50-day ($0.00001425) and 200-day ($0.00001628) exponential moving averages (EMAs).

Should SHIB fail to re-enter the falling wedge, the asset could potentially fall by 18% to its previous six-month low of $0.00001082.

The Relative Strength Index (RSI) currently stands at 47.61, nearing the neutral zone, indicating that SHIB is neither overbought nor oversold. Meanwhile, the Chaikin Money Flow (CMF) sits at 0.03, reflecting a slight positive money flow, which could hint at emerging buying interest.

A declining volume during the recent minor upward move indicates a bearish volume-price divergence, which supports the continuation of the bearish trend unless a significant breakout occurs.

If Shiba Inu manages to break above $0.00001344, it could re-enter the falling wedge, shifting the bias back to bullish. Breaking through the 50 EMA might set the stage for a bullish rally, with potential targets at $0.00001625 and $0.000018.

On-Chain Risk Analysis for $7.24 Billion SHIB Tokens

Shiba Inu’s open interest has dropped by 4.54% in the past 24 hours, signaling a withdrawal of money from the SHIB market. This suggests that the recent minor uptrend may be losing steam, and the bearish trend could continue.

However, an increase in buying pressure and volume might overturn the current bearish outlook and push SHIB prices higher.