The price of Shiba Inu has been quiet for quite some time. However, the last time this kind of price action happened was in September 2021, followed by an exponential move that more than doubled SHIB.
The expectation of a fleeting event
From October 29 to February 3, 2021, Shiba Inu lost about 74% of its value. The swing highs of this downtrend can be connected using a trendline, which indicates the magnitude of this drop. It can also be used to identify an outbreak that occurred on February 6.
Now SHIB seems to be doing something similar this time; the price action from Feb 7 to March 17 led to another 40% drop. Interestingly, the swing highs of this retracement can be connected using a trendline.
For both downside moves, the $0.0000207 support level served as a key turning point absorbing incoming selling pressure. So, allowing buyers to accumulate on the sidelines. The recent retracement is narrowing between the bearish trendline and the horizontal support level. That suggests an explosive outbreak soon.
In the event of a bullish move, investors can expect SHIB to ride the wave and retest the $0.0000350 resistance barrier. This climb would represent a 55% increase from its current position.
While the conservative approach indicates that the upside potential could be limited to around $0.0000350, an optimistic view reveals that the uptrend could reach as high as $0.0000495. However, this move would mean a gain of 122%.
Source: TradingView, SHIB/USDT 1-Day Chart
While the technical data for SHIB shines bright, suggesting a bullish outlook is just around the corner, on-chain stats, especially volume, are revealing some specific signals supporting the bulls.
On-chain volume for SHIB peaked from 640 million on March 15 to 2.29 billion on March 17, revealing a peak of 257%. This sudden rise is often seen as a clever accumulation of money at the end of a downtrend and is considered a buy signal.
However, if something similar occurs near the top, it could serve as a potential sell signal, but by combining the measurements of this index with the social volume, a more accurate indication of a local top can be obtained.
SHIB on-chain volume chart
Anyway, the recent rebound combined with the consolidation and fractal formation confirms that an uptrend is a good idea. The only moot point here is whether SHIB will stop the rise after gaining 55% or higher and will continue until it tests $0.000495 again.