Shiba Inu could be poised for a rally, analyst finds
- SHIB’s key indicator has hinted at the possibility of a bull cycle.
- The meme coin’s value has increased by 19% in the last week.
As the general crypto market witnesses a bull run, one of Shiba Inu’s [SHIB] key technical indicators has “flashed” a buy signal, crypto analyst Ali Charts noted in a recent post on X (formerly Twitter).
Given the infrequency yet precision of such signals, it's a pivotal moment to keep a keen eye… pic.twitter.com/uwdWbSWFZw
— Ali (@ali_charts) October 25, 2023
The analyst assessed the memecoin’s TD Sequential indicator on a weekly chart. This indicator measures the exact time of trend exhaustion and potential price reversals over a specified period.
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It works by tracking the price action of an asset over a series of nine candlesticks. A buy signal is generated when the indicator reaches 9 on a downtrend. Conversely, a sell signal is generated when the indicator reaches 9 on an uptrend.
According to Ali, SHIB’s TD Sequential indicator reclaimed the 9 spot on a downtrend during the intraday session on 25 October.
Hinting at the possibility of a bullish reversal, the analyst added,
“The previous two bullish turns from this indicator led to price surges of 118% and 71%, respectively.”
Does SHIB’s setup support the predicted rally?
At press time, the leading altcoin exchanged hands at $0.000008027. In the last week, SHIB’s value has grown by 19%, according to data from CoinMarketCap.
This is due to the significantly positive correlation it shares with leading coin Bitcoin [BTC], whose price has climbed by over 20% during the same period.
A closer assessment of SHIB’s price action on a weekly chart confirmed Ali’s view that the spot market has entered an accumulation phase. At press time, the coin’s key momentum indicators trended upwards and were positioned above their respective center lines.
This suggested that accumulation outpaced distribution amongst spot traders, hence the press time price rally.
For example, SHIB’s Money Flow Index (MFI) was 61.70. Likewise, its Chaikin Money Flow (CMF) returned a positive value of 0.06 as of this writing.
A CMF reading above 0 indicates that there is more money flowing into an asset than flowing out. Although a CMF value of 0.06 is a relatively low reading, it indicates some buying pressure in the market.
How much are 1,10,100 SHIBs worth today?
Moreover, the coin’s Positive Directional Indicator (green) at 22.58 rested above the Negative Directional Indicator (red) at 18.75. This suggested that the buyers’ strength exceeded the sellers.
Lastly, the Bull Bear Power indicator has climbed steadily since 16 October. At press time, the indicator rested closely to the center line and aimed to re-enter the positive territory. This confirmed the steady growth in bull presence in the SHIB market in the past week.