Despite a recent dip, on-chain data and technical indicators point to a potential short-term rebound for SHIB. As SHIB hovers near a key demand zone, investors are speculating on whether the asset can replicate its historical rally.
The price of Shiba Inu (SHIB) has recently held above a critical demand zone, hinting at the possibility of a short-term trend reversal.
Although the observed pullback raised some questions, technical analysis and on-chain data suggest that buyers could regain control in the coming weeks.
The $0.000013 level has proven to be a strong demand zone for SHIB in the past. Significant resistances and support levels have been observed from this level in previous cycles, indicating buyer interest at these levels.
While SHIB recently rejected a local peak at $0.00001764, holding above the $0.00001380 zone is an encouraging sign. This suggests that buyers may be able to regain control in the short term.
Furthermore, SHIB is forming the same pattern as at the beginning of May, before its 40% surge in the following days. Indeed, a downtrend trendline is present to the north and strong support to the south at $0.00001380. If the trend is similar, SHIB could break it and bounce back in the demand zone below at $0.00001330.
Examining SHIB’s stochastic RSI, it is approaching an oversold zone. This configuration is generally interpreted as a precursor to a potential price rebound.
In the past, deeply oversold stochastic RSI levels have preceded substantial rebounds, especially when coinciding with strong support zones like the one currently observed.
While technical signals seem favorable for a rebound, analysis of on-chain data reveals a more nuanced picture. The number of active addresses has steadily declined since May 11, dropping from over 5,000 to nearly 3,200.
This decline in network activity could indicate a weakening demand or lower participation from retail investors. However, a significant influx on exchanges in the last 24 hours counteracts this bearish sentiment, suggesting potential accumulation rather than selling pressure.
The current SHIB setup reflects a tug of war between bullish technical signals and sluggish network activity. However, price action seems to be more responsive to positive on-chain developments at the moment.
As long as SHIB holds the support zone at $0.00001313, the path of least resistance could remain upwards. Investors will closely monitor the evolution of technical and on-chain indicators in the coming weeks, hoping for a clear signal of a potential swift rebound of Shiba Inu.
For those looking to venture into the world of memecoins, here is a guide to obtaining SHIB on Bitget easily:
Charles Ledoux is a Bitcoin and blockchain technology specialist. A graduate of the Crypto Academy, he has been a Bitcoin miner for over a year. He has written numerous masterclasses to educate newcomers to the industry and has authored over 2,000 articles on cryptocurrency. Now, he aims to share his passion for crypto through his articles for InvestX.
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