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#ShibaInu (SHIB) is exhibiting concerning technical and on-chain indicators, signaling potential downside risk in the near term. A bearish chart pattern is emerging, while exchange inflows have surged by 2 trillion tokens within the past month, increasing selling pressure. If current trends persist, SHIB’s price could decline to approximately $0.0000050, erasing its gains made throughout 2024.
Technical Analysis: Bear Flag Pattern Suggests Further Decline
On the weekly chart,
$SHIB is forming a classic bear flag formation—a bearish continuation pattern that often precedes notable price drops. Confirmation would come with a decisive break below the pattern’s lower support trendline, indicating renewed selling momentum.
Should SHIB breach this critical support level, the next significant target lies near the 123.6% Fibonacci retracement, approximately at $0.0000050. This scenario would negate all positive returns recorded since the start of the year.
Potential Reversal, But Bulls Remain on the Back Foot
There remains a possibility for a bullish turnaround if buyers can push SHIB above the upper trendline of the flag and clear resistance near $0.000021. Achieving this would invalidate the bearish setup and could mark the resumption of upward momentum.
However, current technical indicators remain cautious. The Relative Strength Index (RSI) is at 46, indicating slight bearish dominance, while the Moving Average Convergence Divergence (MACD) remains in negative territory, despite a recent crossover suggesting a tentative buying signal. Market participants await clearer confirmation of renewed strength.
On-Chain Data Highlights Rising Selling Pressure
Supporting the bearish outlook, Santiment’s on-chain data reveals that SHIB’s supply on exchanges has increased from 139 trillion to 141 trillion tokens over the last month. This 2 trillion token inflow, valued at over $28 million at current prices, implies growing readiness among holders to liquidate positions.
With subdued demand, this increasing exchange supply could exert significant downward pressure on SHIB’s price unless offset by strong bullish catalysts.
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Summary
Shiba Inu is currently facing headwinds with a bearish flag pattern forming on the weekly chart and a substantial increase in tokens deposited to exchanges. These factors, combined with weak demand and cautious technical indicators, point to the risk of a decline towards $0.0000050. While a bullish breakout remains possible, the prevailing momentum favors further downside in the near term.