Shiba Inu (SHIB) Price Tests Resistance After 20% Dip — Next Move Could Trap Bears

Key Takeaways

• SHIB is testing the upper trendline of a falling channel, while the AO prints green bars.
• The SHIB MVRV ratio has dropped to 30.89%, approaching the undervaluation region.
• The CMF confirmed rising accumulation, indicating  SHIB could break above $0.000015.

After losing 20% over the past 30 days, Shiba Inu (SHIB) appears ready to rebound. For most of this week, SHIB’s price has consolidated between $0.000011 and $0.000012.

Recent sideways price action in SHIB suggests a tug-of-war between bulls and bears, with neither side gaining clear dominance. Current market signals indicate that bears may be losing their grip, setting the stage for a potential upward move in SHIB’s price.

SHIB Finds Footing

Like the structure of many altcoins, SHIB’s price has been stuck in a falling channel since June 11. However, today, after it appears to have stabilized, the price has retested the channel’s upper trendline, which is a key resistance at $0.000012.

As the cryptocurrency attempts to break this bearish pattern, the Awesome Oscillator (AO) has also changed. As seen below, the AO has flashed consecutive green histogram bars.

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At press time, the RSI had yet to break above the neutral line, but it has risen from its recent lows. Like the AO, this trend indicates increasing bullish momentum.

If the AO moves into positive territory and the RSI rises above the 50.00 rating, SHIB’s price could break the resistance at $0.000012 and $0.000014.

Still Underpriced

From an on-chain perspective, CCN’s analysis reveals that SHIB’s Market Value to Realized Value (MVRV) ratio has dropped to 30.89%. Historically, SHIB tends to top out when the MVRV ratio ranges between 20.67% and 91.03%.

However, when the ratio falls between -39.35% and -13.08%, it signals undervaluation, as most holders are underwater and reluctant to sell.

With the current MVRV ratio hovering closer to undervalued territory, SHIB’s price appears to be trading below its fair value. Therefore, if historical patterns hold, the next few weeks could bring upward price movement.

SHIB Price Prediction: Breakout on Deck

On the daily chart, SHIB’s price is beginning to tilt bullish, supported by a key technical formation. Over the past few weeks, the memecoin’s downtrend has carved out a falling wedge pattern.

This setup suggests the bearish momentum is waning, and a breakout to the upside could be imminent. Besides that, the Chaikin Money Flow (CMF) has risen above the zero signal line.

The rise above this line indicates rising buying pressure. If sustained, SHIB’s price might breach the overhead resistance at $0.000015.

Once this happens, the next move for the cryptocurrency might be a rally to $0.000019 at the 0.618 golden ratio. On the contrary, a decline in the CMF reading could mean selling pressure.

Should that be the case, SHIB might break below the lower trendline of the wedge and drop toward $0.000010.