A cryptocurrency analyst has pointed out how Shiba Inu is retesting a technical support level that could set the tone for what’s to come.
Shiba Inu Is Retesting The Support Level Of A Parallel Channel
In a new post on X, analyst Ali Martinez has discussed a support level for Shiba Inu. The level in question is the lower boundary of a Parallel Channel, a technical analysis (TA) pattern that forms whenever an asset trades between two parallel trendlines. Like other consolidation patterns in TA, the upper line of a Parallel Channel is considered to be a source of resistance, while the lower one is that of support. Either of these levels not holding up can signal a continuation of the trend in that direction.
Parallel Channels can be of a few different types depending upon how the channel is oriented with respect to the graph axes. When the trendlines are sloped upward, the resulting pattern is called an Ascending Channel. Similarly, their pointing down forms a Descending Channel.
In the context of the current topic, the third and most basic type is the one of interest: a channel that’s parallel to the time-axis. This pattern corresponds to a phase of complete sideways action in the asset.
Now, here is the chart shared by Martinez that shows the Parallel Channel that the weekly price of Shiba Inu has been trading inside for the last few years:
As is visible in the above graph, the 7-day Shiba Inu price has fallen to the support line of the Parallel Channel after the latest bearish price action. This level, located at $0.0000066721, was last tested by the memecoin in 2023. Back then, the line held and helped the cryptocurrency turn itself around.
“For Shiba Inu $SHIB, everything depends on its ability to hold above the $0.0000066721 support level,” explained the analyst. It now remains to be seen how the asset’s price will develop in the coming days, given this potentially important retest.
In the scenario that a breakdown happens, the levels highlighted by Martinez in the chart could become the next relevant ones: $0.0000029954 and $0.0000013522. The former is located below the Parallel Channel at a distance equal to half its width, while the latter is at the full width mark.
SHIB Price
Shiba Inu has slid down alongside the rest of the cryptocurrency market over the past week, but its losses have been more contained than some other major names. Even so, a weekly return of -9.9% shows that the bearish momentum hasn’t spared the memecoin.
Source: https://www.newsbtc.com/shiba-inu-news/shiba-inu-fate-hinges-support-level-analyst-says/