Technical analyst Michael sees a potential upside for Shiba Inu (SHIB) despite the recent market slump. Michael’s analysis hinges on the formation of a bull flag pattern on SHIB’s chart, indicating a potential breakout and price surge.
SHIB Struggles Amidst Market Downturn
SHIB has mirrored the broader market weakness, experiencing consistent declines since early June. This downtrend follows a failed retest of the $0.00002622 resistance level on June 6th. Bitcoin’s (BTC) recent price drop is a significant factor impacting the overall market, including SHIB.
Bull Flag Hints at Reversal
Zooming out, Michael’s analysis reveals a more extensive downtrend for SHIB on the weekly timeframe. Since its peak of $0.000045 on March 5th, SHIB has formed a series of lower lows and lower highs. However, this downtrend appears to have laid the groundwork for a bullish pattern – a bull flag.
The bull flag’s pole emerged from SHIB’s sharp 370% surge to $0.000045 in March. The ongoing downtrend forms the flag itself. This technical structure often signifies a temporary pause in an uptrend, characterized by consolidation or a corrective phase, before the uptrend resumes.
Shiba Inu Poised for Breakout?
For SHIB to reclaim its uptrend, a breakout above the downward channel formed during the recent turbulence is crucial. Michael anticipates this breakout to happen soon, paving the way for further price appreciation.
Elliott Wave Theory Paints a Bullish Picture
Michael, known for his Elliott Wave analysis, highlights that SHIB is currently following a classic five-wave Elliott Wave pattern. The coin is likely within the fourth wave, which typically features price corrections. However, Michael expects the fifth and final wave to commence with a breakout from the downtrend channel in the coming weeks.
Should this breakout materialize, Michael projects a bullish target of $0.00010114 for SHIB upon completion of Wave 5. This translates to a staggering 398% increase from SHIB’s current price of $0.00002028.
Also Read: Shiba Inu (SHIB) at Crossroads: Bearish RSI Hints Dip, But Consolidation Play Remains
Crucial Support and Renewed Interest
Maintaining the psychological support level of $0.00002 is paramount for SHIB in the near term. A breach below this level before a market rebound would make reaching the $0.00003 level much more challenging.
Encouragingly, SHIB witnessed renewed interest over the weekend. The Accumulation/Distribution metric displayed a rise from 12.67 trillion to 14.16 trillion SHIB on Sunday, suggesting potential buying pressure. Additionally, SHIB’s RSI (Relative Strength Index) sits at 34.89, indicating ample room for significant price hikes.
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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