Shiba Inu Under Threat: Two Dangerous Chart Patterns
Date: 2025-01-27 Author: Henry Casey Categories: CRYPTO PAYMENTS
The decline in the price of Shiba Inu to the support level of $0.000020, the lowest since December 20, indicates a possible strong downtrend. Two risky patterns are forming on the coin’s chart, which may indicate a further decline.
Shiba Inu is expected to soon form a “death cross” pattern, which occurs when the 50-day and 200-day moving averages cross each other. The distance between these two moving averages continues to shrink, indicating a possible decline. Earlier, on June 20, 2024, Shiba Inu already formed this pattern, which led to a price drop of more than 40%, from $0.000017 to $0.000010.
However, after that, a "golden cross" pattern was formed on the chart on October 20, which led to an 80% increase in price to $0.00003340 in November. However, the situation is much worse now, and further decline is not excluded.
In addition to the "death cross", Shiba Inu also formed a small double top pattern, which is a classic trend reversal indicator. The double top is at $0.00002488, and the neckline is at $0.00001970. In case of a breakout of the key support at $0.00001788, the coin may continue to fall, and the next target is $0.00001192, which is a strong support along the Murray line.
An additional factor supporting the negative trend is the decrease in activity on the Shiba Inu network. According to IntoTheBlock, the number of new and active addresses has decreased by 27.5% and 25% over the past seven days. This could be due to many traders selling their coins in favor of newer meme coins like Fartcoin and Official Trump.
There has also been a significant drop in Shiba Inu coin burns, which have fallen by almost 94%. On Sunday, only 656,468 coins worth $15 were burned. This is due to a drop in activity on the Shibarium network, the second tier for Shiba Inu, where the average transaction fee has dropped from 0.0003 BONE in November to 0.0001 BONE.
In addition to this, Shiba Inu trading volume is now behind newer meme coins. For example, Official Trump volume was $4.56 billion, while Shiba Inu volume was only $160 million. This suggests that investors are moving on to newer, more promising projects.
