Shiba Inu (SHIB) seems poised to extend its recent gains, as the daily technical setup suggests the meme coin may be gearing up for a 30% rally. Additionally, key support levels and increasing buying pressure indicate favorable conditions for an upward move.
But can the price of SHIB rise higher than this week? This analysis considers the possibility.
Shiba Inu forms a cup and handle pattern
On the daily chart, BeInCrypto observes that SHIB has formed a cup and handle pattern. The cup and handle is a bullish technical chart pattern resembling a "U" shape (cup) followed by a slight downward drift (handle). This pattern indicates the potential for a continued uptrend.
As seen below, the technical setup for SHIB shows that the meme coin formed the cup from mid-July to early October. During this period, the token moved within a range from $0.000013 to $0.00018.
However, the handle was formed earlier last month and remains applicable at the time of writing. This suggests that the price of SHIB may be ready for a significant breakout. Therefore, if buying pressure increases, the value of the meme coin could rise above $0.000019.
Shiba Inu Cup and Handle. Source: TradingView
Meanwhile, the Money Flow Index (MFI) shows increasing buying pressure, further supporting the potential for a continued uptrend.
The MFI is a technical oscillator that combines price and volume data to assess the buying and selling pressure of an asset. It moves between 0 and 100, with values above 80 typically indicating overbought conditions and values below 20 indicating oversold conditions.
When the MFI decreases, it means that selling pressure is present. However, this index is currently rising, indicating that investors are determined to buy SHIB. Therefore, if this continues, the value of the meme coin could continue to rise.
Shiba Inu Money Flow Index. Source: TradingView
SHIB Price Prediction: Targeting $0.000025
Another look at the daily chart shows that SHIB is facing resistance around its current value. However, with buying pressure indicated by the MFI, it may overcome this obstacle.
BeInCrypto also uses the Fibonacci retracement index to analyze the extent to which the SHIB technical setup can attract the meme coin.
Fibonacci retracement levels are horizontal lines drawn on a price chart to identify potential support and resistance levels. These levels correspond to key Fibonacci ratios (23.6%, 38.2%, 50%, 61.8%, and 100%).
If the price breaks out from these levels, it suggests that the previous trend may continue in the same direction. As seen below, the price of SHIB has bounced off the 61.8% level. Thus, the price of the token could increase by 30% to $0.000025.
Shiba Inu Daily Analysis. Source: TradingView
On the other hand, if the token does not break $0.000020, this prediction may not come true. Instead, SHIB could drop to $0.000015.
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