Dog-themed cryptocurrency Shiba Inu (SHIB) is on the verge of a moving average crossover on its weekly chart.
The weekly SMA 50 has turned downward and might cross beneath the weekly SMA 200 in the coming weeks, creating a rare and potentially bearish technical signal — a weekly death cross — which might materialize if the current market trend does not reverse.
A death cross happens when a shorter-term moving average (usually the 50-week MA) falls below a longer-term moving average, such as the 200-week MA. It is often seen as a bearish signal, indicating that downward momentum is gaining strength.
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If confirmed, this would be the first time Shiba Inu would form a death cross on the weekly time frame, a rare occurrence for the token. Unlike the more regular daily death crosses, the appearance of a weekly death cross is significant, particularly in conventional technical analysis, because it may indicate a deeper shift in market structure.
What to expect?
Although death crosses may not always result in large price losses, they frequently coincide with extended periods of weakness or sideways trading, particularly when accompanied by declining volume and lackluster sentiment.
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While a weekly death cross might be a serious technical signal, it does not guarantee a crash indicator, especially on the cryptocurrency market, where volatility and sentiment can shift quickly. However, it does suggest that Shiba Inu may face further consolidation or downside pressure unless bulls step in soon.
In this scenario, the $0.00001 level has shown to be strong support so far this year, with SHIB bulls expecting to find succor here if prices fall. The overall market sentiment will also be watched to adjudge the SHIB price direction.
If Shiba Inu finds a bottom owing to the emergence of the death cross, it might rally significantly to reach 2024 yearly highs of $0.000045. At press time, SHIB was up 0.17% in the last 24 hours to $0.00001178.
