Shiba Inu (SHIB), the meme coin that gained popularity alongside its rival Dogecoin (DOGE), has shown signs of recovery in recent weeks. After reaching a yearly low of $0.00000597 on June 10th, SHIB has gradually started to bounce back. The excitement among investors has been further fueled by the upcoming release of Shibarium, a layer-2 solution.
The announcement that Shibarium will be unveiled at the Blockchain Futurist Conference in Canada from August 15th to 16th, 2023, has generated a wave of optimism. However, from a technical perspective, SHIB has yet to confirm a trend reversal.
While DOGE has already crossed above the 200-day Exponential Moving Average (EMA), a widely recognized chart analysis indicator, SHIB still needs to break through this important technical indicator. In simple terms, a price above the 200-day line suggests an uptrend, while a price below indicates a downtrend.
A classic approach would identify a strong buying signal when the price moves from below to above the trendline. Investors keeping an eye on SHIB are still waiting for this buying signal, despite the fact that the meme coin is currently trading 55% higher than its June 10th low.
It is worth noting that the recent positive price trend allowed SHIB to climb above the 50-day EMA, which is a modest victory. Currently, SHIB faces a tough battle against the 100-day EMA, with a price of $0.00000840. At the time of writing, Shiba Inu was traded just below this level, at $0.00000830.
Another bullish argument is that the meme coin has recently broken out of the ascending triangle formation that had trapped it since mid-June. SHIB should not fall back below the previous resistance of the formation at $0.00000831 to confirm the breakout. Notably, the 23.6% Fibonacci retracement level also coincides with this price, making it doubly important.
If Shiba Inu can maintain its current position and use the 23.6% Fibonacci level as support, it could successfully break through the horizontal resistance at $0.00000870. This could potentially lead to a jump to the bullish boundary - the 200-day EMA at $0.00000933.
If the SHIB bulls manage to achieve this feat, it would trigger a technical buying signal. This could potentially pave the way for further growth, with the next resistance looming at the 38.6% Fibonacci retracement level of $0.00000976.
At this point, significant selling pressure can be expected, as this price level served as strong support from March to May this year. Additional price targets include the 50% Fibonacci level at $0.00001093 and the 61.8% Fibonacci level at $0.00001209.
A bearish scenario would be triggered if SHIB fails to sustain the breakout above $0.00000831 on the 1-day chart. A decline to the previous month's low of $0.00000709 could be on the horizon. Holding this price level will be crucial to avoid revisiting the yearly low of $0.00000597.
However, with the highly anticipated launch of Shibarium less than a month away, this bearish scenario appears less likely. The question that investors are grappling with is whether Shibarium will be the catalyst that finally signals a trend reversal for Shiba Inu. Only time will tell.
