In the wake of Bitcoin’s resurgence past the $41,000 mark following cooling inflation reports, the crypto market experienced a brief uptick in buying demand. Meme coins, notably Shiba Inu (SHIB), witnessed a recovery from recent lows. However, as the crypto market braces for potential corrections, Shiba Inu faces challenges despite a surge in price.
Netflow Dynamics: Accumulation and Potential Correction
Shiba Inu recently weathered a steep decline, resulting in over $1.5 million in long liquidations. The crypto’s recovery followed reports of a cooling inflation rate, prompting increased accumulation near its recent lows. However, a noteworthy development is the reversal of Netflow from negative to positive.
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While negative flow indicated accumulation during price dips, the shift to positive flow suggests investors who bought SHIB at lower prices are moving their holdings to exchanges. This could potentially heighten selling pressure as these investors seek opportunities to capitalize on the recent price surge. The influx of SHIB into exchanges may signal a looming correction, particularly if the meme coin reaches a price peak, triggering sell-offs.
Market Sentiment and Technical Analysis
Despite the potential headwinds, the overall market sentiment remains bullish. According to Coinglass data, approximately 52% of positions anticipate a price rise, with a long/short ratio of 1.0738. However, 48% of positions are opposed to this upward trend, signalling a divergence in buying pressure.
On the 4-hour price chart, SHIB faces resistance at the $0.0000098 mark, with continuous rejections by bears. Buyers are gearing up for a surge, eyeing a break above Fib channels. Currently trading at $0.0000095, a critical level to monitor is the 20-day Exponential Moving Average (EMA) at $0.00000961. A breakthrough at this level would indicate sustained bullish sentiment, potentially propelling SHIB to surpass the $0.00001 threshold and reach $0.00001175.
Conversely, a drop below the immediate support of $0.000009 may suggest profit-taking by traders. In such a scenario, SHIB could face further downside toward the crucial support zone of $0.0000087-$0.0000075. Buyers are likely to defend this level vigorously, seeing it as an attractive accumulation point for potential gains.
As Shiba Inu navigates these dynamics, the crypto community watches closely, balancing optimism with caution amid the ever-evolving landscape of the cryptocurrency market.