- SHIB’s steady decline has led to the formation of a descending triangle.
- The lower trendline of the triangle forms a critical support level.
Leading meme coin Shiba Inu [SHIB] has formed a descending triangle, which it may break below if market sentiments remain bearish.
At press time, SHIB exchanged hands at $0.000023, trading close to the lower trendline, which created a critical support level.
When an asset’s price declines, a descending triangle is formed to suggest to market participants that the downward price movement may continue.
What next for SHIB?
An assessment of SHIB’s price movements hinted at the possibility of a break below the support line.
For example, the meme coin’s Relative Strength Index (RSI) sat at the neutral line of 50.0 and was in decline at the time of writing.
This signaled that coin distribution was about to outpace accumulation among market participants.
Since the 9th of April, the coin’s Elder-Ray Index, which measures the relationship between the strength of the altcoin’s buyers and sellers in the market, has returned predominantly negative values.
When this indicator negative like this, bear power dominates the market. As of this writing, SHIB’s Elder-Ray Index was -0.0000017.
If the bears force a decline below the triangle’s lower trendline, which forms support, readings from SHIB’s Fibonacci Retracement showed that the meme coin’s value may drop under $0.00002 to trade at $0.000013.
However, if sentiment reverses and the bulls regain market control, SHIB’s value may rally toward $0.000027.
Source: SHIB/USDT on TradingView
Futures traders are unmoved by recent losses
Despite the steady decline in SHIB’s value, its Futures market participants have remained resilient. This was gleaned from the uptick in the coin’s Futures Open Interest since the beginning of May.
According to Coinglass data, at $66 million at press time, this has grown by 20% since the 1st of May.
SHIB’s Futures Open Interest refers to the total number of the coin’s Futures contracts that have yet to be settled or closed.
When it rises this way, it indicates an increase in market participants entering new positions.
Read Shiba Inu’s [SHIB] Price Prediction 2024-2025
Also, the meme coin’s Funding Rate across cryptocurrency exchanges has remained positive. A positive Funding Rate is a good sign, suggesting a demand for more bullish leverage positions.
This means more market traders are entering trade positions in favor of a price rally.