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Shiba Inu (SHIB) Paints Candle of Hope

Tue, 08/08/2023 - 17:00
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Arman Shirinyan
Shiba Inu's bullish trend might continue from here, despite setback
Shiba Inu (SHIB) Paints Candle of Hope
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Recent market data paints a somewhat optimistic picture for Shiba Inu (SHIB) enthusiasts. The token saw a 14% reversal, managing to stay buoyed above the $0.000009 mark. For investors closely tracking SHIB's performance, this offers a glimmer of hope, especially as the digital currency grappled to maintain its position above $0.00001 recently.

This hopeful rally comes after a somewhat tumultuous period for Shiba Inu. It was only recently that the token experienced a sharp setback upon failing to sustain its position above the 200 EMA. This significant resistance level, once breached, was expected to act as a robust support, but instead, SHIB encountered heightened selling pressure. This downward pressure led not only to a price decline but also invalidated the token's recent positive rally and breakthrough.

Shiba Inu chart
Source: TradingView

One of the primary culprits behind this precarious performance seems to be the notable profit-taking activity from cryptocurrency whales. Analyzing the on-chain data reveals a surge in large transactions on the Shiba Inu network. This spike, which indicates massive sales by prominent holders, can substantially sway market sentiment and the coin's price trajectory.

Furthermore, despite the release of the much-anticipated Shibarium, there have not been sufficient fundamental growth drivers to propel SHIB upward. This, coupled with the evident whale activity, has made the digital currency's journey above the $0.00001 threshold a challenging endeavor.

Doji did not help Ethereum

Cryptocurrency enthusiasts and traders are accustomed to the unpredictable nature of the market, but sometimes even expected patterns throw curveballs. Such is the case with Ethereum (ETH) recently. Despite showcasing a "doji" pattern, which typically heralds a possible reversal, Ethereum's price seemed to forget its next move and continued to hover sideways.

"Doji" is a classic candlestick pattern often used by traders as an indicator of a potential price direction change. It represents a session in which the opening and closing prices are virtually identical, signifying indecision on the market. When a "doji" appears after a pronounced downtrend or uptrend, it often suggests that the momentum is waning and a price reversal might be on the horizon.

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However, Ethereum's chart told a slightly different story. After the "doji" pattern's appearance, market participants braced for an upward trajectory, considering ETH had been trading under pressure. Instead, Ethereum kept a steady course, trading at around $1,830.

This lack of decisive movement could well be attributed to the low trading volume that Ethereum is currently experiencing. A robust trading volume often acts as the driving force behind significant price shifts. It is the lifeblood that provides liquidity, and without it, substantial price movements, either up or down, become less likely. The almost nonexistent trading volume for Ethereum may be the primary factor preventing it from capitalizing on the potential reversal indicated by the "doji."

Pepe whales gave up

Pepe (PEPE) recently found itself in the spotlight when a whale decided to offload a staggering 2.26T PEPE, equivalent to $2.53 million, at an average price of $0.000001121. This sale resulted in a considerable loss of $707,000 for the whale.

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The large sell-off is not the whale's only misadventure. In an earlier transaction, this particular entity spent a whopping 1,102 ETH (equivalent to $2 million) to purchase BALD, another crypto asset. However, when offloading BALD, the whale only received a return of 189 ETH, approximately $346,000. The difference amounts to a staggering loss of 912 ETH, or $1.6 million.

Such transactions, especially when they involve huge sums, often send ripples through the cryptocurrency market. They either lead to panic selling, fearing a downward spiral, or attract opportunistic buyers waiting for a price drop to make their entry.

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About the author

Arman Shirinyan is a trader, crypto enthusiast and SMM expert with more than four years of experience.

Arman strongly believes that cryptocurrencies and the blockchain will be of constant use in the future. Currently, he focuses on news, articles with deep analysis of crypto projects and technical analysis of cryptocurrency trading pairs.