The Shiba Inu Market (SHIB) is in a very strong bull market in 2021, and a major continuation pattern on its longer time frame charts highlights the margin for a further 90% advance to the upside.
In detail, SHIB increased more than 1250% so far this year (YTD) to set the yearly high at $ 0.00003528 (Binance data) on Oct 8. Later, the cryptocurrency crashed under profit-taking sentiment, leading to a 41.50% price correction at $ 0.00002060.
But the bulls started accumulating SHIB near said low level. There was a bounce and the price rose more than 55% to $ 0.00003200, where it was met with another round of sell-offs. Overall, SHIB price continued to form higher highs and lows in the coming sessions, forming a triangle structure that looked like a Bull Pennant.
Analysts treat pennants as bullish continuation patterns, that is, its formation, together with the decline in trade volumes, tends to send prices in the direction of their previous trend, as much as the height of the previous price rally, also known as flagpole.
From the looks of it, SHIB has been forming the same structure.
The height of the SHIB flagpole is around $ 0.00002450. Therefore, considering that the cryptocurrency would seek an upside breakout from the apex of Bull Pennant (the level at which its upper and lower trend lines converge), its next target would be around $ 0.00005200, roughly 90% higher. .
However, pennants are known to be the worst reliable technical indicators, at least according to one study conducted by Cody Hind of Samurai Trading Academy in 2020, based on his evaluation of 10 years of market data and more than 200,000 trading structures.
It found that Bull Pennants successfully reached its price targets in 54.87% of the cases.
Macro fundamentals
SHIB's price nearly doubled in October in part due to Tesla CEO Elon Musk's cryptic endorsement of the Shiba Inu project and amid reports of whale buying activity and the rise of its decentralized ShibaSwap exchange.
Hence, musk posted the photo of her Shiba Inu puppy October 4. The billionaire businessman's tweet coincided with SHIB's price spike by more than 330% over the next four days, reminiscent of how it influenced Dogecoin (DOGE) prices earlier this year.
Floki frunkpuppy pic.twitter.com/xAr8T0Jfdf
- Elon Musk (@elonmusk) October 4, 2021
The jump was also based on reports of whale buying activity at the Shiba Inu market. For the uninitiated, Yahoo Finance outstanding in its October 5 report that an unknown entity bought 6.2 trillion SHIB for around $ 44 million at the end of September.
Related: Shiba Inu recovers 40% despite huge sales of SHIB whales
Meanwhile, Shiba Inu's namesake decentralized exchange, ShibaSwap, spotted an increase in the amount held by its liquidity pools. As of Monday, the total value locked up within the ShibaSwap contracts was $ 411.42 million versus $ 253.41 million earlier this month, according to data provided by DeFi Llama.
At its best, in July 2021, ShibaSwap was manage $ 1.76 billion in funding through its liquidity fund.
Ishan Arora, a hedge fund manager associated with Tykhe Block Ventures, told Yahoo Finance that Shiba Inu emerged as a product of a constant craze for meme cryptocurrencies, adding that most people buy these tokens simply by following the advice of a few influencers.
Arora warned investors about the risks of investing money in such wonders in one fell swoop, but mentioned Dogecoin for its ability to generate incredible returns earlier this year.
"The early Doge investors last year did pretty well, so it's not as black and white as most want."
Meanwhile, crypto data tracking service Santiment spotted a spike in Shiba Inu whale transactions of more than $ 100,000 in the past 24 hours, noting that its occurrence is typically bullish for SHIB.
"When these transactions are carried out in groups, they generally follow the price increases," said the platform. wrote in a tweet posted on Monday.
The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph.com. Every investment and business move involves risk, you should do your own research when making a decision.
Post navigation
Previous Post
ProShares Bitcoin ETF to debut on NYSE on Oct. 19
