On Dec 17, Shiba Inu ( SHIB ) price failed to break out of the ascending parallel channel and has been declining since then.
The weekly and daily timeframe readings are at odds with each other. There is also a clear drop in tokens burned over the past 24 hours.
Shiba Inu clears diagonal drag
Looking at the weekly timeframe price action, SHIB price has been rising since falling to a low of $0.0000054 in June.
In November, this rally caused the SHIB price to break above a descending resistance trendline that had been in place for 480 days.
Despite the breakout, the SHIB price did not surge higher. Instead, it traded very close to the descending resistance trendline.
It is also worth noting that only 500,000 tokens were destroyed in the past 24 hours, a significant drop from the previous day.
Market traders use the RSI as a momentum indicator to identify overbought or oversold conditions and decide whether to accumulate or sell an asset.
A reading above 50 and in an uptrend suggests that bulls still have the upper hand, while a reading below 50 would suggest the opposite.
When the price broke out, the RSI rose above 50 (green icon), legitimizing the uptrend.
SHIB Price Prediction: How Long Will the Price Adjust?
Compared to the weekly outlook, the daily time frame suggests that the SHIB price could be due for a correction. This is attributed to the observed price action and the RSI indicator.
SHIB encountered rejection at the ascending parallel channel resistance trendline (red icon) on December 17. Subsequently, a lower high was formed on December 23, indicating a bearish signal.
One notable factor is the bearish divergence on the daily RSI during the rejection. A bearish divergence occurs when momentum declines while prices rise, strengthening the likelihood of a pullback.
If SHIB continues to fall, the nearest support is expected to be around $0.0000095, which is a 10% drop from the current price.
