- Driven by current trading patterns, Shiba Inu (SHIB) may be set to revisit a crucial point.
- An analyst has spotted a descending channel on Shiba Inu’s price chart, suggesting a potential 20% rally.
- Many SHIB tokens have been taken off exchanges, reinforcing this prediction.
Shiba Inu (SHIB) may be set for a 20% rally, according to a crypto analyst. This article explores the factors contributing to this prediction, including trading patterns and token movement.
Analyst Predicts SHIB Rally
Ali Martinez, a crypto analyst, has suggested that Shiba Inu (SHIB) might be set for a 20% rally. Martinez shared a 4-hour SHIB/USD chart which showed the token in a descending channel. A descending channel appears when two downward trendlines are drawn above and below a price. The upper trendline represents resistance while the lower one indicates a support level. The Shiba Inu native token had formed lower highs and lower lows across five trendlines, suggesting a potential breakout.
SHIB is Undervalued
As of this writing, the memecoin changed hands at $0.0000236— a 7.42% increase in the last 24 hours. This increase suggested that SHIB might have begun the breakout journey. Should this continue, then SHIB might hit $0.00002954 within a few days. Furthermore, an on-chain analysis using the Market Value to Realized Value (MVRV) ratio suggested that SHIB is undervalued. At press time, Shiba Inu’s 30-day MVRV ratio was -1.239%, meaning that holders who purchased the token will get this average loss if they sell at the current price. However, since the ratio is closing in on the positive region, the price might increase, validating the bullish thesis.
HODL is the Mantra
Apart from the MVRV ratio, the token’s supply on exchanges and those outside of them were also considered. An increase in exchange supply indicates that traders are holding Shiba Inu for the short term, and could sell the asset anytime. If it decreases, it means that a rise in the decision to HODL. At press time, SHIB’s supply on exchanges was down to 74.7 trillion. On the other hand, the supply outside had increased to 927.17 trillion. This difference in the metrics was proof that many holders of the memecoin believe in its long-term potential. As such, the cryptocurrency might not experience major selling pressure in the short term.
Conclusion
Given the current trading patterns and token movement, Shiba Inu (SHIB) may be set for a 20% rally. However, this would only be the case if the exchange supply does not hit hundreds of trillions. As the sentiment in the market remains positive, the $0.00002954 prediction might come to pass.
