Shiba Inu, commonly known as SHIB, has attracted considerable attention from market participants due to the formation of a symmetrical triangle on its 4-hour chart.
This chart pattern typically signifies a period of uncertainty in the market, but many analysts are anticipating a potential upward breakout in line with the overall bullish trend seen in the cryptocurrency sector.
In this article, we delve into the key factors influencing SHIB’s price action and assess the potential directions it may take in the near future.
Indicators Point Towards a Possible Rally
SHIB has been trading within a symmetrical triangle pattern, indicating a phase of market indecision.
An upward breakout is anticipated, with a target price of $0.00003255, which could lead to a 32% price increase from current levels.
The symmetrical triangle, formed by converging support and resistance lines, is a common continuation or breakout pattern in technical analysis.
A decisive breach above the resistance level could trigger bullish momentum, while a breakdown below the support level might result in further price declines.
Currently, Shiba Inu is consolidating within a tight range, with the price near $0.00002478, demonstrating reduced volatility post a previous surge.
Technical indicators like the Alligator, showing converging Moving Averages, and the True Strength Index with bearish values suggest a lack of clear market direction, though sellers are losing their grip.
The Awesome Oscillator, displaying a negative value, corroborates the absence of significant bullish momentum at present.
SHIB Encounters Key Levels Amidst Market Changes
The MVRV ratio has recently dropped by 4.02% in the past 24 hours, indicating potential profit-taking or a decline in market optimism.
Compared to its 52-week high on March 6, 2024, the MVRV ratio is significantly lower, signaling reduced speculation in the market.
Historically, the MVRV ratio has hit extremes with a peak of 5.15 in October 2021 during overvalued conditions and a trough of 0.3233 in June 2023 amidst undervaluation, presenting buy opportunities.
Currently, the ratio is closer to neutral levels, suggesting a balanced valuation without extreme undervaluation or overvaluation.
Network Activity Reflects in NVT Ratio
Shiba Inu’s Network Value to Transaction (NVT) Ratio offers insights into the asset’s valuation concerning its transaction volume.
Recently, the NVT ratio decreased by 2.30% in the last 24 hours, indicating a slight uptick in transaction activities relative to network value.
It remains well below its 52-week high, showing a shift from previously overvalued conditions.
The historical NVT ratio data underscores its significance, with extremes showcasing overvalued or undervalued conditions. The current ratio indicates balanced transaction volumes compared to SHIB’s market value.