• Shiba Inu price triggers inverse head-and-shoulders pattern on June 28, setting the stage for further gains.
  • 50 twelve-hour simple moving average (SMA) has turned higher again, offering relevant support as the altcoin makes the turn.
  • SHIB is at striking resistance of the now visible 50-day SMA at $0.00000939.

Shiba Inu price has been engaged in a lengthy bottoming process that appears to be finally resolving to the upside after SHIB triggered the neckline of an inverse head-and-shoulders pattern on June 29. If the digital asset can overcome the declining 50-day SMA, it may rally 30% before identifying relevant resistance and interested sellers.

Shiba Inu price enters July with a bounce in its step

SHIB investors have been patiently waiting for some clarity in the price structure since the rapid decline in May. Shiba Inu price hinted at a few turning points, but the weight of the cryptocurrency market volatility kept the meme token from defining a precise turning point. However, this changed on June 29 as SHIB triggered an inverse head-and-shoulders pattern’s neckline before falling back into the base.

The 70% advance from the June 22 low did push the twelve-hour Relative Strength Index (RSI) near an overbought condition, so investors should not label the pullback into the base as a failure but a necessary pause in the evolution of the pattern. Nevertheless, it is essential to note that the 50-day SMA at $0.00000939 lingers just above the neckline, suggesting the pause may endure a few days.

The measured move target of the inverse head-and-shoulders pattern is 80%, projecting a Shiba Inu price of $0.00001680, which is just below the 38.2% Fibonacci retracement level of May’s crash at $0.00001754.

It is a bold forecast, but a more realistic target is the May 24 high of $0.00001204 or the May 20 high of $0.00001214, yielding a 30% gain for SHIB investors.

Interestingly, other cryptocurrencies like XRP and ZIL formed inverse head-and-shoulder patterns before delivering significant returns, albeit from a larger footprint on the charts.

SHIB/USD 12-hour chart

SHIB/USD 12-hour chart

For now, Shiba Inu price action is constructive, but if the pause evolves into a deeper pullback, SHIB needs to hold the 50 twelve-hour SMA at $0.00000744 or risk revisiting the May 19 low or even a sweep of the right shoulder low of $0.00000560. Of course, this scenario gains precedence if the cryptocurrency complex reverts to heavy selling.

The SHIB 30-day MVRV ratio, currently at 13.75%, is indicating a mildly overvalued condition. More specifically, it reveals that the average gain of all addresses that have acquired SHIB in the past 30 days is 13.75%. It is a period that covers the majority of the bottoming process since the May crash.

Generally, the higher the MVRV ratio, the greater the unclaimed profits, thus the higher the risk that SHIB holders will begin to sell and lower their exposure. This is why it is believed that extremely high MVRV ratios indicate overvalued conditions and a reason to sell. In contrast, very low MVRV ratios indicate undervalued conditions and may offer a timely opportunity to accumulate.

The SHIB 30-day MVRV ratio is now positive, but it does not confirm a large reservoir of selling pressure that could enter the market at current prices. However, investors may aim to capture profits around the $0.00001204-$0.00001214 range after the lengthy bottoming process. The 30-day MVRV ratio would still be well below the April and May highs, but that price range would represent a gain of over 100% from the right shoulder low of $0.00000560, representing a notable overvalued condition and a reason to sell.


SHIB 30-day MVRV ratio - Santiment

SHIB 30-day MVRV ratio - Santiment

Shiba Inu price is at an inflection point on a micro-scale as it navigates the neckline and the approaching 50-day SMA, but SHIB is far from an overvalued level that would spur heavy selling. For now, it is a technical story until buying pressure can unhook the resistance and release Shiba Inu price to better outcomes.

Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.

If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.

FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.

The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.

Cryptos feed

Latest Crypto News


Latest Crypto News & Analysis

Editors’ Picks

SafeMoon prepares for 26% advance

SafeMoon price has climbed after a brutal sell-off that ended on June 22. The ascent has sliced through a critical resistance level but is struggling to breach the next barrier. Therefore, SAFEMOON is likely to pull back to the immediate support floor.

More SafeMoon News

Uniswap consolidates before pump to $21

Uniswap price has entered a minor correction toward $18 after hitting resistance at $19.30. The technical setup is still very much in favor of Uniswap going higher. UNI enjoys the current risk-on environment, and fundamentals are still in benefit of it going higher.

More Uniswap News

These three cryptos could soon recover and reach new all-time highs

Bitcoin price has been down in the dumps with multiple failed attempts to escape the ranging market. Most altcoins promptly follow the flagship crypto, but Solana, Chainlink and Litecoin have a different plan and might recover quicker than the rest to hit new all-time highs.

More Cryptocurrencies News

Shiba Inu price to retest crucial support before SHIB bulls set up next advance

Shiba Inu price has recently broken out of a bearish formation, introducing the potential for a new rally. SHIB escaped above a critical resistance trend line that has acted as a possible turning point for the meme coin’s disappointing returns since the May crypto market crash. 

More Shiba Inu News

BEST CRYPTO BROKERS/EXCHANGES



Bitcoin Weekly Forecast: Markets revert to mean, but BTC price remains indecisive

Bitcoin price shows considerable strength after springing from the recent crashes. Still, it is uncertain whether the current bullish impulse will morph into a new uptrend or lead to a more profound decline.

Read the weekly forecast

BTC

ETH

XRP