"Shiba Inu rebound? It's an illusion"...Bounces back right before a breakthrough

▲ Shiba Inu (SHIB)

An analysis suggests that while Shiba Inu (SHIB) is attempting a rebound after a long-term decline, its structural potential for an upward trend 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 breakthrough, it is actually interpreted as a period testing the accumulated selling pressure over several months.

The key resistance is the 100-day exponential moving average. This indicator is formed almost at the same position as the upper channel resistance and is considered an area where mean-reversion traders and trend-following sellers are likely to enter simultaneously. In the past, Shiba Inu has repeatedly failed to recover this moving average.

Trading volume also fails to support a breakthrough. 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 shows an upward trend but is only increasing gently without sharp expansion. This pattern often leads to a slowdown in upward movement rather than a resistance breakthrough.

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. This content should be interpreted for informational purposes only.*