How much longer can Shiba Inu [SHIB] hold on to its 8-month support level

Disclaimer: The findings of the following analysis are the sole opinions of the writer and should not be considered investment advice

Shiba Inu has been on a steady downtrend since November, but since January, it had found solid support. However, as May began, the price crashed right past this level of support and fell another 50%. Bitcoin has also been in a downtrend, and there was not much investor confidence across the altcoin market as fear dominated.

Shiba Inu bounced weakly from the aforementioned support level in the past two weeks, but demand was not yet present on the charts.

SHIB- 1 Day Chart

Source: SHIB/USDT on TradingView

Since November, the price has been forming a series of lower highs and lower lows. SHIB has lost nearly 64% of its value since the start of 2022, and at the time of writing was trading above the $0.0000094 support level.

As the LUNA/UST crisis unfolded, and Bitcoin also sank rapidly from the $37k mark to reach as far south as $27.2k, Shiba Inu posted losses of 52% within five days. As things stand, it is still trading at a 40% discount from where SHIB was trading at before the crash.

There was no strong influx of strong demand even though the price reached levels it previously traded at in September 2022. Therefore, long-term investors would do well to wait patiently for SHIB to show signs of accumulation and a breakout upwards.

Rationale

Source: SHIB/USDT on TradingView

The RSI stood at 33 at press time to denote heavy bearish momentum. Since April, the RSI has been below neutral 50 to show a prominent downtrend, and the price also registered lower highs and lower lows to confirm the notion of a downtrend.

The OBV has been steadily dropping lower as well, which meant that selling pressure has been greater than buying pressure in the past few months. Alongside, the CMF also remained steadfastly below the -0.05 mark to show that capital flow has been directed out of the markets.

Conclusion

Long-term investors need to remember that patience is the key, and would want to wait for Shiba Inu to establish something like a range, and show signs of being accumulated by strong buyers. Such an accumulation phase was not yet established for SHIB, and could take weeks or months to make itself clear. Therefore, the measured approach for SHIB investors could be to wait and watch, especially as market sentiment still appeared to be fearful.