"Shiba Inu Rebound? It's an Illusion"...Turns Downward Again Just Before a Breakout

▲ Shiba Inu (SHIB)

Analysis suggests that while Shiba Inu (SHIB) is attempting a rebound after a prolonged decline, its structural potential for an upward reversal is limited.

U.Today reported on May 2 (local time) that Shiba Inu is attempting to stabilize by raising its lows within a narrow ascending channel, but the overall structure remains in a bearish environment. Currently, Shiba Inu is close to the upper resistance line of the ascending channel. While it appears to be an attempt at a breakout, it is actually interpreted as a testing phase for several months of accumulated selling pressure.

The key resistance is the 100-day Exponential Moving Average. This indicator is formed in almost the same position as the upper channel resistance and is considered a high-probability area for both mean-reversion traders and trend-following sellers to enter simultaneously. In the past, Shiba Inu has repeatedly failed to recover this moving average.

Trading volume also does not support a breakout. Although recent activity has increased somewhat, it is insufficient to be considered strong accumulation, and most of the upward movement occurred with average trading volume. This is interpreted as a sign of a lack of conviction from buyers.

Momentum indicators are also limited. The Relative Strength Index is showing an upward trend, but it remains at a level of gradual increase without sharp expansion. This pattern often leads to a slowdown in upward momentum rather than a resistance breakout.

The currently formed ascending channel is also difficult to view as a strong reversal pattern. A gentle channel formed after a sharp drop is generally classified as an extension of a downtrend, not a trend reversal. If it fails to break through the upper resistance, the price is likely to retrace to around $0.0000060, where the lower trendline of the channel is located.

*Disclaimer: This article is for investment reference only, and we are not responsible for any investment losses based on it. The content should be interpreted for informational purposes only.*