Shiba Inu price leads weekly gains with a 20% rise but now stands vulnerable to corrections

Shiba Inu price has emerged as one of the best-performing assets this month, leading the crypto market gains, especially this past week. However, looking at the market indicators, it seems like this might not last for long should SHIB holders decide against sustaining their gains.

Shiba Inu price could note corrections

Shiba Inu price trading at $0.00000963 managed to mark a near 20% rally in the last seven days. The altcoin has been trending upwards after breaching the resistance level at $0.00000791, bringing it up by more than 23% to the current market value. In doing so, SHIB also breached through the 50-, 100- and 200-day Exponential Moving Averages (EMA).

SHIB/USD 1-day chart

However, Shiba Inu price might run out of its bullishness soon since the Relative Strength Index (RSI) suggests that the meme coin is dangerously close to hitting the overbought zone above 70.0. A reach into this area indicates potential corrections as the market needs to cool down after being overheated.

This is backed by the Market Value to Realized Value (MVRV) ratio, which is nearing the threshold of 15%. Beyond this point begins the “danger zone,” which is an area synonymous with price declines. The reason behind this is that the investors are currently enjoying profits and are much more likely to sell for profits. Consequentially, this will result in corrections, as observed in the past too.

Shiba Inu MVRV ratio

This would threaten the gains observed by investors in the past couple of days. The increase in price also led to an increase in profits that resulted in the concentration of investors facing losses declining to 66%. 

Shiba Inu investors at a loss

With the losses at a four-month low, the meme coin has the opportunity to sustain the rise observed recently, provided investors don’t move to sell.