Shiba Inu (SHIB) has been battling a downtrend since early May. However, recent technical indicators suggest a potential reversal on the horizon. An analysis of the daily Shiba Inu chart reveals a downtrend that began on May 4.
This decline followed a recovery attempt in early May, which came after a significant price decline in April, the highest monthly decline since the Terra ecosystem collapse in May 2022.
The downtrend encountered a potential turning point on May 13. On that day, the price of SHIB retested the lower Bollinger Band, an indicator commonly used by traders to assess market volatility and potential buying or selling pressures.
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When a cryptocurrency’s price touches or falls below the lower Bollinger Band during a downtrend, it can signal oversold territory, potentially indicating a trend reversal.
Bollinger Bands, Volatility and Analyst Predictions
The Bollinger Bands on the SHIB chart are contracting, which signifies decreasing volatility. This compression often precedes a significant price movement, either upwards or downwards. With the current excitement from increased whale activity, the Bollinger Bands have renewed hope for a SHIB surge soon.
Further bolstering the possibility of a bullish reversal is a triangle identified by analysts on the daily SHIB chart. An analyst recently identified a converging triangle pattern suggesting a breakout and a potential potential massive upswing.
Current market sentiment leans towards optimism. SHIB is trading at $0.00002506 with a 2.35% increase over the last 24 hours. The meme coin is poised for another attempt now that it has broken through the $0.000025 resistance zone.
Analyst expectations for the price target vary. Some predict a rise to $0.00005, while market analyst SHIB Knight (believes a reversal could see SHIB reach $0.00006, representing a potential increase of over 146% from the price when he performed his analysis.
Data from Santiment, a crypto analytics platform, supports this notion. It shows a drop in Shiba Inu’s volatility this week. On May 12, SHIB volatility reached its lowest point in three months, at 0.003097.
This level was last seen in late February, just before a massive surge of almost 400% that propelled SHIB to over $0.00004 on March 5. While volatility has seen a slight increase recently, it remains below the daily average.
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SHIB’a Future
The technical indicators and analyst sentiment suggest a potential trend reversal. The Bollinger Band contraction, declining volatility, and chart pattern breakout all point toward a possible price increase. Shytoshi Kusama, the Shiba Inu lead developer recently shared an optimistic message. These bullish signals have boosted the excitement and optimism in the community.
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