The price of the Shiba Inu (SHIB) token has not seen a significant impact from the recent token burn, despite a reduction in circulating supply. The token is still trading below a long-term descending resistance trendline, even though it broke out from a short-term channel.
Shiba Inu Consolidates in Long-Term Pattern
Looking at the weekly timeframe chart, SHIB’s price has been declining below a descending resistance trendline since August 2022. This trendline caused a rejection in August 2023, leading to a further decline in price. The nearest horizontal support zone can be found at $0.0000060.
The Relative Strength Index (RSI) shows an undetermined reading for SHIB. When the RSI reading is above 50 and the trend is upward, bulls have the upper hand. In the case of SHIB, the RSI is increasing but is below 50, indicating an undetermined trend.
On October 28, 250 million SHIB tokens were burned, reducing the circulating supply. The Shiba Inu team announced that a surprise identity launch would take place in 72 hours.
SHIB Price Prediction – Will It Kickstart Reversal?
On the daily timeframe, there is a more positive perspective for SHIB. The price had been trading within a descending parallel channel since August 14, suggesting corrective actions. However, SHIB managed to move above the trendline on October 22 and saw a bullish divergence in the RSI.
If the upward momentum continues, SHIB’s price could increase by 45% and reach the next resistance at $0.0000110, potentially causing a breakout from the long-term descending resistance trendline and leading to a longer-term bullish trend reversal.
However, failure to move above the 0.382 Fib retracement resistance level at $0.0000085 could result in a 10% drop and validate the short-term horizontal support at $0.0000070.
Hot Take: Shiba Inu’s Price Stalls Despite Token Burn
The recent token burn of Shiba Inu (SHIB) has not had a noticeable impact on its price. Despite breaking out from a short-term channel, SHIB is still trading below a long-term descending resistance trendline. The weekly timeframe chart shows that SHIB’s price has been declining since August 2022, with a rejection in August 2023 leading to further decline.
The Relative Strength Index (RSI) indicates an undetermined trend for SHIB, with an increasing but still below 50 reading. The recent token burn reduced the circulating supply, but it remains to be seen if this will have a significant effect on the price.
On the daily timeframe, there is a more positive outlook for SHIB, with a potential breakout from the descending parallel channel and bullish divergence in the RSI. If the upward momentum continues, SHIB could see further gains and potentially break out from the long-term descending resistance trendline.
However, failure to move above the 0.382 Fib retracement resistance level could lead to a drop in price and validate short-term support levels.
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