Following a recent wave of $383,000 in liquidations, the price of Shiba Inu (SHIB) is beginning to show signs of recovery. While this might appear to signal a trend reversal, market signals remain mixed.
🔹 Nearly $400K in Liquidations: What Does It Mean?
Over the past 24 hours, SHIB's price increased by 1%, with daily trading volume reaching $93 million. At the same time, derivative market data shows that over $383,000 worth of leveraged long positions were liquidated — suggesting that overconfident bullish bets backfired.
This liquidation wave has now shifted the balance toward a majority of short positions in the market. Ironically, this could trigger a short squeeze — a sudden price rally caused by short sellers rushing to cover their positions, potentially pushing SHIB’s price even higher.
🔹 Technical Indicators Signal Possible Drop Ahead
Despite signs of minor recovery, the technical setup remains bearish. SHIB continues to move within a descending parallel channel, forming lower highs and lower lows since May 10. Over the past month, this pattern has resulted in an 18% price decline.
📉 The Relative Strength Index (RSI) is hovering around 38, indicating strong selling pressure. Likewise, the MACD is showing continued weakness, with both the signal line and histogram remaining in negative territory.
There’s a real risk that if SHIB fails to hold the support level at $0.0000119, the price could break lower and add another zero — potentially dropping to $0.000009.
🔹 Bullish Hopes: Will History Repeat Itself?
Despite the bearish outlook, there are glimmers of optimism. Historically, each time SHIB has tested the lower support trendline, it triggered a bullish reversal. This was the case in both March and April, when the token bounced strongly from support.
If SHIB can once again defend the $0.0000119 level, it may signal a trend reversal and spark renewed bullish momentum. In the event of a short squeeze, SHIB could not only overcome bearish resistance but also aim for multi-week highs, possibly targeting $0.000045 as suggested by some analysts.
🔹 Conclusion: Bounce or Breakdown?
Shiba Inu remains in a vulnerable position. The descending price channel and bearish indicators point to continued downside pressure. However, the recent wave of long liquidations has set the stage for a potential short squeeze, giving bulls a window of opportunity.
The market now stands at a critical juncture — whether SHIB holds its ground and reverses upward or breaks support and continues downward will likely unfold in the coming days.
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