Shiba Inu (SHIB) Price Creates Lower High — Final Pullback Before the Next Rally

Key Takeaways

• Shiba Inu (SHIB) broke out from a long-term resistance.
• The SHIB price trades in a short-term parallel channel.
• Does the Shiba Inu trend show bullish or bearish momentum?

Shiba Inu started November with positive momentum, increasing by 80% and reaching a high of $0.0000304 on Nov. 12.

However, it could not maintain its momentum the rest of the month and has fallen since. On Nov. 24, the price created a lower high and now risks breaking down from a short-term parallel channel.

What implications will this short-term breakdown have for the long-term SHIB trend, and where can the meme coin find support if it breaks down? Let’s find out.

Shiba Inu Breaks Out

The weekly time frame SHIB chart shows that the price has rallied alongside an ascending support trend line (dashed) since June 2023. More recently, it bounced at the trend line in August (white icon), starting the current upward movement.

At the start of November, SHIB broke out from the $0.0000200 horizontal resistance area and a descending resistance trend line. The trend line existed since the yearly high, so the breakout is a sign the correction has ended.

SHIB reached a high of $0.0000304 before falling slightly. However, it still trades in the middle of the long-term range between $0.0000200 and $0.0000340.

Technical indicators are bullish. The Relative Strength Index (RSI) and Moving Average Convergence/Divergence (MACD) are increasing and above their bullish thresholds. So, the weekly time frame suggests the SHIB price will increase toward the range high of $0.0000340.

Possible SHIB Price Drop

While the weekly chart is bullish, the daily one suggests an initial drop could happen before the SHIB price resumes its bullish trend. This is because of both the wave count and indicator readings.

The wave count shows that SHIB has completed wave one (white) of a five-wave increase and is now correcting in wave two. The sub-wave count is black, implying that SHIB is in wave C of this decline.

A likely target for the bottom of the decline is at $0.0000205, created by the 0.5 Fibonacci retracement support level. Afterward, SHIB could begin to wave three with a target of at least $0.0000575.

Technical indicators are neutral. The RSI and MACD are both falling but are above their bullish thresholds. So, SHIB may be in a short-term downward movement inside a longer-term bullish trend.

The shorter-term six-hour chart aligns with this possibility. The count shows an ascending parallel channel, which usually contains corrective movements. The SHIB price was rejected by the channel’s midline twice (black icons).

A breakdown from the channel will confirm wave C has started. After the SHIB price reaches the $0.000205 support level, it could reverse a bullish trend toward new highs.

Bullish Long-Term Trend

The Shiba Inu price risks a breakdown from a short-term ascending parallel channel. This could be the final downward movement in a correction ongoing since Nov. 12.

Afterward, SHIB could resume its long-term rally toward a new yearly high.

About the Author

Valdrin Tahiri

Valdrin discovered cryptocurrencies while getting his MSc in Financial Markets from the Barcelona School of Economics in 2017. He has been an avid investor and trader since. Valdrin has written for several cryptocurrency media companies such as BeInCrypto and CoinGape.

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