Shiba Inu (SHIB) briefly rallied last week, breaking out of a short-term descending channel and stirring optimism among bullish traders. The move above $0.000017 during the second week of May initially hinted at a potential trend reversal. However, the rally stalled at this resistance, a lower high compared to mid-February, and the meme coin quickly retraced.
Over the past three weeks, SHIB has gradually declined, approaching the former range highs at $0.000014. Despite the 20-day and 50-day moving averages still pointing upward, the momentum has clearly weakened, placing the bullish narrative on thin ice.
Descending Triangle Hints at Trend Reversal
Technical analysis reveals that SHIB’s price action has carved out a descending triangle pattern, with a series of lower highs compressing against a flat support near $0.0000142. This structure typically signals a bearish continuation. If SHIB closes a daily session below this critical level, it could trigger a shift in market structure from bullish to bearish.
Indicators further support the bearish outlook. The Chaikin Money Flow (CMF) has dropped to the zero line, suggesting a lack of significant capital inflow or outflow. Similarly, the On-Balance Volume (OBV) has remained flat throughout May, reflecting waning demand.
Liquidation Clusters Signal Imminent Price Drop
According to CoinGlass, SHIB’s 1-month liquidation heatmap shows a dense cluster of liquidation levels just below the $0.000014 support zone. This buildup, formed over the past ten days, coincides with the descending triangle’s lower boundary, amplifying the risk of a near-term price dip.
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If SHIB dips below $0.000014, a 3% immediate drop is likely as liquidity is triggered. This could escalate into a more substantial sell-off, pushing the meme coin toward the mid-range support at $0.0000129—a potential 9.3% decline from current levels.
As demand softens and technical patterns align, SHIB traders should brace for increased volatility and the possibility of a deeper correction.
Disclaimer: The information in this article is for general purposes only and does not constitute financial advice. The author’s views are personal and may not reflect the views of Chain Affairs. Before making any investment decisions, you should always conduct your own research. Chain Affairs is not responsible for any financial losses
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