The price of Shiba Inu (SHIB) experienced a significant drop after being rejected by a resistance trend line on December 17. However, the price has since recovered and is currently trading above a crucial horizontal area. The question now is whether it can make a final push to end the year on a positive note.
Shiba Inu Consolidates Above Resistance
After reaching a low of $0.0000054 in June, the SHIB price has been on the rise. It created a higher low in October and continued to increase at an accelerated rate. Last week, it even surpassed a long-term horizontal resistance area, but failed to sustain the upward movement. This brought the price back to the horizontal area, which has acted as both support and resistance since May 2022.
RSI Indicates Bullish Trend
Traders often use the Relative Strength Index (RSI) as a momentum indicator to determine market conditions. If the RSI reading is above 50 and trending upward, it suggests that bulls still have an advantage. In this case, the weekly RSI is above 50 and increasing, indicating a bullish trend.
SHIB Price Prediction: Breakout or Rejection?
While the weekly chart suggests a bullish outlook, the daily chart indicates that an initial decrease is likely before the price can continue its upward movement. The price action shows that SHIB has been trading within an ascending parallel channel since June, which often contains corrective movements. On December 17, SHIB reached the channel’s resistance trend line and was rejected, accompanied by a bearish candlestick and a bearish divergence in the RSI. If the price continues to fall, it may reach the closest support at $0.0000095.
Hot Take: Potential Breakout Ahead
Despite the short-term bearish prediction, a breakout from the channel would signify the completion of the correction and could lead to a 40% increase to the next resistance at $0.0000150.
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