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Shiba Inu (SHIB) Forms Strongest Divergence in Asset's History: It May Lead to This

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Wed, 8/02/2023 - 17:00
Shiba Inu (SHIB) Forms Strongest Divergence in Asset's History: It May Lead to This
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Despite the rise of bearish tendencies in the cryptocurrency trading community, the market's performance was far from showing any weakness as the majority of assets have been gradually gaining value and even showing double-digit returns in some cases.

SHIB delivers important signal

Shiba Inu, the meme cryptocurrency, has delivered a bearish divergence in its Relative Strength Index (RSI) signal. RSI divergence is a technical indicator used to identify potential price reversals on an asset by comparing the movement of the asset's price to the movement of the RSI.

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Source: TradingView

Since Jan. 20, Shiba Inu has been moving in the opposite direction of the RSI, which could be seen as a bearish signal. This, combined with the variety of bearish signals currently seen on the market, could indicate that the asset is at risk of a downward reversal.

Despite the bearish signal, Shiba Inu has been showing a solid performance on the market since the beginning of the year, gaining more than 70% to its value. The asset has become one of the strongest performing cryptocurrencies on the market, attracting numerous investors and traders.

Ether's upcoming volatility spike

Ethereum Open Interest, a measure of the amount of outstanding contracts on the Ethereum options and futures market, has recently reached a two-year high. This surge in open interest can be attributed to the cryptocurrency market recovery that began in January, with Ethereum leading the charge. The increase in open interest reflects rising leverage on the market, which has a significant impact on the volatility of the asset.

Open interest is the total number of outstanding contracts on a future or options market. It represents the total amount of money invested in a particular derivatives market and is considered a key indicator of market activity and liquidity. When open interest rises, it generally means that more money is flowing into the market, creating more liquidity and greater market activity.

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With Ethereum, the rise in open interest could indicate a growing interest in the asset, as well as a growing demand for leveraged exposure to the cryptocurrency market. The increased demand for leveraged exposure could drive the volatility of the asset, potentially leading to larger price swings in both directions.

LDO is seeing volume spike

Lido Finance (LDO) has been making headlines lately as the trading volume of the cryptocurrency reaches a nine-month high. One of the most likely reasons for the increase in volume is the growing staking volume on the Ethereum network.

The increase in staked Ethereum liquidity is driving up demand for LDO as a leading liquidity provider on the market. This is evident in the double-digit gain that Lido Finance has experienced in the last two days, with the asset gaining more than 14% to its value in the last 48 hours alone.

Another factor that could be contributing to the spike in trading volume is the potential long-term view of Lido Finance as a leading liquidity provider for staked Ethereum. With Ethereum being one of the most popular and widely used cryptocurrencies in the world, having Lido Finance as a reliable provider of staked Ethereum liquidity is a significant advantage for the asset.

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