Shiba Inu (SHIB) sprung surprises on the optimism held by analysts of an imminent bounce back as the market took an unexpected turn. SHIB’s price plummeted below the crucial 50 EMA support level and is showing no signs of recovery.
Shiba Inu’s Market Position and Key Support Levels
Currently, SHIB’s market position is risky following this sudden drop. Notably, a breach of the 50 EMA support level indicates that sellers are gaining control. The 200 EMA now serves as the next critical support, even though it is a fragile one.
Market watchers maintain that the spike in selling volume following SHIB’s dip below the 50 EMA is indicative of low confidence on the part of traders. If these investors continue to experience losses, the dumping trend could take a worse turn.
Specifically, if the bearish momentum persists, SHIB may test the 200 EMA and potentially drop further. Last month, Crypto-Vanguard noted that June is bearish for Shiba Inu, a trend that is already playing out.
This was based on historical data which saw the memecoin plummet 4.75% in June 2021, 12% in June 2022, and 11.5% in the same month of 2023.
Technical Indicators and Potential for Recovery
Additionally, SHIB’s RSI is hovering just above the oversold territory on this downward trend. While this indicates that SHIB is currently oversold, a bounce back is not certain. Moreover, moving averages are presently not favorable for SHIB. Also, the 20 EMA’s bearish crossover below the 50 EMA often signals further declines.
With SHIB’s price is currently below all major moving averages, which is generally a bearish indicator. As such, top analysts have urged investors to keep monitoring the pattern to avoid further losses. As of the time of writing, Shiba Inu is trading at $0.00002366, down 5.36% according to CoinMarketCap.
In spite of the bearish trend facing Shiba Inu, crypto analyst Davie Satoshi says the memecoin has potential both in the short-term and long-term. Satoshi tags Shiba Inu as an “overlooked gold mine,” possibly suggesting that a price rally is still possible given SHIB’s internal supply regulation mechanism.
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