SHIB’s August losses have eased somewhat at a key support area, but if BTC records more losses, it could break through that support area.

The price plunge in August stopped at the December 2022 low.

Buyers have gained control of the market, but a strong recovery remains elusive.

Shiba Inu [SHIB] bulls stepped up to defend the December low at $0.00000779 and arrested the August decline. But Bitcoin [BTC] has yet to show signs of recovering August’s losses, which could also complicate SHIB’s recovery efforts.

What’s next for SHIB?

It gained about 40% in the first half of August, bringing it to April levels of $0.000011. A sharp reversal in the second half of August wiped out all those gains.

However, the decline slowed at the confluence of the December low ($0.00000779) and the previous resistance zone of $0.00000785 – $0.00000824 (white).

In the second half of August, the Relative Strength Index (RSI) fluctuated below the 50 midpoint, indicating a decrease in buying pressure. In addition, the CMF was below the zero level, indicating a significant capital inflow during the same period.

If BTC records more losses in the coming days/weeks, SHIB could break below the $0.00000785 to $0.00000824 support zone. To the south, the next supports are $0.00000750 and $0.00000698.

Conversely, the bulls must clear the hurdle and confluence of the invalidated bullish OB $0.00000876–$0.00000948 (cyan) and the May range high ($0.00000903) to push higher.

But before that, the bulls have to deal with the immediate hurdle and the May range low of $0.00000846.

Buyers gain an advantage, but…

According to Coinalyze, CVD (Cumulative Volume Delta) has been increasing steadily since August 18. This suggests that bulls have gained a considerable advantage after the SHIB hit its December low.

Interestingly, the open interest (OI) rate hit new highs between August 19 and 22, indicating weak demand. But it improved since August 23 and eased since August 25. Therefore, the fluctuating OI does not mean a strong rebound for SHIB.

Traders should track Bitcoin's movement as they may be forced to exit their long positions at current support levels if they break.