Shiba Inu burn rate spikes 6,223%: Can SHIB break resistance for a rally now?

• The bullish golden cross and RSI signal SHIB’s potential for a sustained uptrend.
• On-chain metrics and reduced exchange reserves highlight strong accumulation and growing confidence.

Shiba Inu [SHIB] has taken the spotlight with a dramatic 6,223% surge in its burn rate and an impressive price recovery. At press time, SHIB was trading at $0.00002521, reflecting a 1.25% decline over the past day.

Despite this slight pullback, SHIB is poised near a critical resistance level, supported by compelling technical indicators and strong on-chain activity. The pressing question is whether SHIB can break through and sustain its upward momentum.

Technical indicators align for SHIB’s bullish move

Shiba Inu’s daily chart reveals a golden cross formation, where the 50-day moving average has crossed above the 200-day moving average. This bullish signal often predicts prolonged upward momentum.

Currently, SHIB faces a crucial resistance level at $0.00002275, which previously acted as a major support. Breaking above this zone could open the path to SHIB testing $0.00004, a level unseen since its earlier highs.

The Relative Strength Index (RSI) currently stands at 66.26, signaling robust buying activity. While this reflects optimism, traders should be cautious, as RSI nearing overbought levels can indicate a potential correction.

However, if buyers maintain pressure, SHIB could sustain its rally and establish a stronger price foothold.

On-chain activity shows positive divergence

Shiba Inu’s on-chain data reveals a striking 50.91% positive price-DAA divergence. This metric highlights increasing network activity as SHIB’s price rises, a clear indicator of strengthened user engagement.

Historically, such divergences align with bullish price action, signaling growing investor confidence.

Additionally, exchange reserves for Shiba Inu have dropped by 0.46% in the last 24 hours, now sitting at 138.75 trillion tokens. This decline indicates reduced selling pressure, suggesting a strong accumulation phase.

Consequently, fewer tokens on exchanges enhance SHIB’s chances of a continued rally.

Market sentiment reflects strong interest

The broader market sentiment toward Shiba Inu remains bullish, as evidenced by a 4.85% increase in open interest, now totaling $101.71 million. This surge in open interest highlights heightened speculative activity and increased confidence in SHIB’s upward potential.

Consequently, the convergence of bullish sentiment and technical strength sets the stage for a possible breakout.

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Shiba Inu is primed for further gains, supported by its golden cross, reduced exchange reserves, and positive on-chain divergence. If SHIB decisively breaks above $0.00002275, the next target could be $0.00004.

However, traders should remain cautious as resistance levels and overbought RSI conditions might cause short-term hurdles. For now, Shiba Inu appears ready to sustain its upward momentum.