Shiba Inu’s price has remained lull for quite some time now. However, the last time this type of price action occurred was in September 2021, which was followed by an exponential move that more than doubled SHIB.
The expectation of a volatile event
From 29 October to 3 February 2021, Shiba Inu lost roughly 74% of its value. The swing highs of this downtrend can be connected using a trend line, denoting the extent of this decline. Also, it can be used to identify a breakout that occurred on 6 February.
Now, SHIB seems to be doing something similar this time; the price action from 7 February to 17 March has led to another 40% downswing. Interestingly, the swing highs of this retracement can be connected using a trend line.
For both these downward moves, the support level at $0.0000207 served as a major inflection point that absorbed the incoming selling pressure. Thus, allowing sidelined buyers to accumulate. The recent retracement is getting constricted between the declining trend line and the horizontal support level. Thereby, suggesting an explosive breakout soon.
In case of a bullish move, investors can expect SHIB to ride the wave and retest the $0.0000350 resistance barrier. This climb would constitute a 55% ascent from the current position.
While the conservative approach indicates that the upside could be limited to around $0.0000350, an optimistic outlook reveals the uptrend could extend up to $0.0000495. This move, however, would represent a 122% gain.
Source: TradingView, SHIB/USDT 1-day chart
While the technicals for SHIB are shining bright, suggesting a bullish outlook is around the corner, on-chain metrics, volume, in particular, is revealing some specific signals that support the bulls.
The on-chain volume for SHIB spiked from 640 million on 15 March to 2.29 billion on 17 March, revealing a 257% spike. This sudden uptick is often observed as a smart money accumulation at the end of a downtrend and is considered a buy signal.
However, if a similar thing occurs at the top, it could serve as a potential sell signal, but combining this index’s readings with social volume can give a more accurate indication of a local top.
SHIB on-chain volume chart
Regardless, the recent uptick combined with the consolidation and fractal formation confirms that an uptrend is a no-brainer. The only arguable point here is if SHIB will stop its ascent after a 55% gain or continue higher until it retests $0.0000495.
