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One of Shiba Inu's most significant psychological levels is being tested once more. SHIB briefly fell below $0.000005 following a steep selloff earlier this month, but buyers intervened and drove the asset back toward the level. Whether the market is getting ready to reclaim this level or is just waiting for another decline is the question at hand.
Technically speaking, SHIB is still in a more general downward trend. The token continues to trade below the 20-day, 50-day, and 100-day moving averages, all of which are still declining. This indicates that bears continue to dominate the broader trend in spite of the recent recovery.
Between $0.0000050 and $0.0000052 is where the immediate battleground is located. The 20-day EMA and former support that became resistance following the recent breakdown are located in this region.
Scenario 1: A positive comeback.
In the best-case scenario, SHIB would recover $0.0000052 and build support above it. The 50-day EMA is currently located between $0.0000056 and $0.0000058, which is the next resistance zone. Such a move would probably result in more buying pressure. A successful break above that area would indicate that the recent selloff was probably a capitulation event rather than the start of another significant leg down.
Scenario 2: Sideways Consolidation.
In a more plausible short-term scenario, SHIB might continue to be stuck between $0.0000046 and $0.0000052. Following the initial rebound, volume has significantly decreased, indicating that both buyers and sellers are awaiting a clearer signal. In this situation, SHIB might build a base for a few weeks before making a more significant move in either direction.
Scenario 3: A bearish collapse.
As long as SHIB trades below significant moving averages, the bearish scenario remains possible. Support close to $0.0000045 will become crucial if the token is unable to recover $0.000005 and selling pressure resumes. A break below that level could push SHIB toward new local lows and render the current recovery effort invalid.
For the time being, SHIB is at a critical juncture. Although the asset has not yet bid farewell to $0.000005, it has also not successfully reclaimed it. Whether this level becomes support once more or becomes another ceiling that keeps the meme coin stuck in its downtrend should become clear over the course of the next few trading sessions.
U.Today Editorial Team
Dan Burgin
