Shiba Inu (SHIB) Surges 24% Weekly, Faces Potential Pullback

Shiba Inu (SHIB), a prominent meme coin, has experienced a significant surge in value, with a 24% increase over the past week. At the time of reporting, the coin was trading at $0.000015, marking a 4% gain for the day. This rally is part of a broader trend in the meme coin market, where several other coins have also seen substantial gains.

However, recent market activity suggests that the upward momentum of SHIB may be slowing down. There are signs of profit-taking, and technical indicators point to weakening demand for the altcoin. One of the key indicators used to gauge market momentum, the Bollinger Band Trend (BBTrend), has started to show a decline. The histogram bars of this indicator have been gradually shrinking in size over the past few days, signaling a steady decrease in buying pressure in the SHIB market.

The BBTrend indicator is used to identify when an asset is experiencing excessive upward or downward movement. When the size of its green bars reduces, it indicates that buying momentum is weakening. This could potentially slow down SHIB’s upward price movement. If this trend continues, the meme coin may face a potential pullback or consolidation in the near term.

Additionally, there has been a noticeable increase in demand for short positions on SHIB since May 6. The coin’s Long/Short Ratio has returned values below one since then, indicating a growing preference for short bets. As of the latest data, the ratio stands at 0.98. When traders increase short interest, it suggests a lack of confidence in the coin’s ability to maintain its upward trajectory. The rise in short positions further supports the likelihood of a price dip in the near future.

The falling Chaikin Money Flow (CMF) for SHIB also highlights the dropping buying pressure among traders. This momentum indicator is trending downward and attempting to break below the zero line. A breach of the zero line would confirm a negative shift in the market trend, potentially causing SHIB to erase some of its recent gains and fall toward $0.000010.

On the other hand, if SHIB’s price maintains its uptrend, it could reach a multi-month high of $0.000019. However, the current technical indicators and market sentiment suggest that a pullback or consolidation is more likely in the near term. Investors and traders should closely monitor these indicators and market conditions to make informed decisions.