According to technical analysis, the Shiba Inu price has the potential to drop by 20% in April as it forms a classic bearish continuation pattern.
SHIB
Over the past 24 hours, the cryptocurrency has seen a daily increase of over 10%, thanks to a broader uptrend in the meme-based cryptocurrency. But will SHIB’s price rise further?
SHIB’s price follows Dogecoin’s gains
On April 4, SHIB’s price reached $0.00001159 in a day after rebounding from a local low of $0.00001049, a gain of 10.5%. Still, the memecoin has underperformed compared to most of its competitors, including Dogecoin
It jumped more than 30% during the same period.
In the year-to-date timeframe, SHIB and DOGE have seen almost identical gains of around 38%.
SHIB’s price started to rise after Twitter, owned by self-proclaimed Dogecoin supporter Elon Musk, replaced its iconic blue bird logo with Dogecoin’s Shiba Inu symbol. SHIB/USD has seen similar rallies in the past due to Musk’s mention of Dogecoin on Twitter.
Interestingly, in October 2021, Musk clarified that he does not own a Shiba Inu.
From a technical perspective, SHIB has been consolidating inside what looks like a bear flag pattern, which could limit its ability to reflect Dogecoin’s 30% price rally.
The Bear Flag is a bearish continuation pattern that forms when the price briefly moves higher within an ascending parallel channel after experiencing a sharp decline. It resolves after the price breaks below the lower trendline on strong volume and falls as much as the height (flagpole) of the previous downtrend.
As of April 4, SHIB has been testing the upper trendline of the flag (near $0.00001160) to see if a pullback to the lower trendline (near $0.00001050) is possible.
A further close below the lower trendline could trigger a bear flag breakdown scenario with a downside target near $0.00000883 in April, which represents a decline of more than 20% from current price levels.
Conversely, a break above the flag’s upper trendline could invalidate the bearish setup. As such, SHIB’s upside target appears to be located at its long-term descending trendline resistance – around $0.00001400 in April, representing a 25% gain from current prices.
