thecryptobasic.com
Shiba Inu has broken below a bull pennant formed on the 6-hour timeframe, raising questions of its ability to mount a recovery toward the initial $0.0000348 target.
The ongoing crypto market downtrend, which picked up on April 8, has persisted for over a week now, leading to massive declines in cryptocurrency prices. SHIB has taken a hit along with the rest of the altcoin market, dropping below crucial support levels to trade at $0.000022.
At the start of the latest downturn, market analyst MBM Crypto confirmed on April 9 that Shiba Inu had formed a bullish pennant on the 6-hour chart following its drop from $0.000045 on March 5. This bull pennant held for five weeks, with no breakout to either side in sight.
Shiba Inu Breaks Below Bull Pennant
During his initial analysis, the analyst suggested that SHIB could record a breakout to the upside when the ongoing market correction slows. According to him, if Shiba Inu pushes toward $0.0000301, investors should enter the market, as this price would serve as the launchpad for a breach above the upper trendline.
He then set three modest price targets that market participants should expect after this breach occurs, with the first target stationed at $0.00003130, the second at $0.00003280 and the third one along the March 14 high of $0.0000348.
Notably, bull pennants typically feature breakouts to the upside, solidifying MBM Crypto’s conviction of an imminent uptrend. However, as the bears exerted more pressure on the broader market, Shiba Inu faced greater selloffs. As a result, SHIB eventually broke to the downside of the pennant when it slumped below the $0.000026 on April 12.
The analyst had set a support zone between $0.00002446 and $0.00002670, which he expected to hedge against any further declines in the event of a downward breakout. However, SHIB further breached below this support zone amid the downturn, collapsing to $0.000022.
Analysts Remain Optimistic
Shiba Inu’s slump below the bull pennant and the crucial support zone has triggered questions on the feasibility of a reclamation of the $0.0000348 target. Despite the downward push, SHIB still has the potential to recover to the $0.000034 territory, largely dependent on when the broader market rebounds.
Notably, chart data confirms SHIB is currently leaning toward undervalued territories, with its CCI currently at -118.30 and RSI sitting at 39.51 on the daily timeframe. This signals room for potential growth. In addition, Shiba Inu is now witnessing a resurgence of interest, with Open Interest recording a considerable surge.
Multiple industry commentators expect Shiba Inu to engineer a recovery from these lows, with projections of price targets at $0.0001. Some analysts expect SHIB to surpass this level and reach $0.001 after the Bitcoin halving. SHIB currently trades for $0.00002225 at the reporting time.