The bullish revival from the $0.0098-mark laid a foundation for the recent week-long buying spree. As a result, Shiba Inu [SHIB] rose to retest the $0.0129-level after multiple weeks. (For brevity, SHIB prices are multiplied by 1000 from here on).
While the price action took a steep plunge below the 20 EMA (red) and the 50 EMA (cyan), the bears took control of the immediate trend.
Should the buyers gather enough thrust to sway through the Point of Control (POC, red), SHIB could register near-term gains. At press time, SHIB traded at $0.01135, down by 3.12% in the last 24 hours.
SHIB 4-hour Chart
Source: TradingView, SHIB/USD
Over the last five days, the sellers kept posing recovery hurdles while the 20 EMA looked to jump below the 50 EMA. Any bearish crossovers would hamper the near-term recovery chances. To top it up, the volumes have also been receding. Thus, making the alt’s current position quite fragile.
With the price action sailing near the POC and EMA ribbons, SHIB would aim to break its squeeze phase and break into high volatility in the coming times.
However, the alt formed a falling wedge-like structure as the momentum shifted toward the sellers.
An immediate close above the pattern could seem rather unlikely owing to the POC and EMA resistance. The alt could see a sluggish phase near the POC region. An eventual recovery beyond the POC would aid the buyers in testing the $0.0121-level.
Recovery from the 61.8% support level could provide the bulls a much-needed force to invalidate the bearish tendencies. Any drop below this level or the 200 EMA (green) would ignite shorting signals. In this case, the targets would lie in the $0.01053-mark.
Rationale
Source: TradingView, SHIB/USD
The RSI has been moving south for over five days now. An inability to break the bonds of the midline would aid the sellers in inflicting drawdowns.
But the OBV’s higher troughs bullishly diverged with the price action over the past two days. Thus, a near-term bounce-back from its immediate support seemed plausible. However, the altcoin’s directional trend [ADX] seemed substantially weak.
Conclusion
Given the confluence of the 61.8% level and the 200 EMA support, the bulls could hold on to their immediate grounds. Any close above the POC could reaffirm the buying signals. The targets would remain the same as discussed.
But the alt shares a whopping 92% 30-day correlation with Bitcoin. Hence, keeping an eye on Bitcoin’s movement with the overall market sentiment could be essential to identify any bullish invalidations.
