The much-anticipated golden cross pattern recently emerged on the Shiba Inu (SHIB) price chart, stirring excitement among investors. Formed two days ago, this pattern typically signals potential growth, but SHIB’s price surprised the market by sharply declining over the next 48 hours. Instead of climbing, SHIB dropped over 16%, moving from a high of $0.00003 down to a local bottom of $0.000023, where buyers stepped in.
Understanding the Golden Cross Pattern
The golden cross occurs when a short-term moving average crosses above a long-term moving average, hinting that the asset might be undervalued. Most commonly, analysts observe this phenomenon with the 50-day and 200-day moving averages.
Source: TradingView
When the 50-day average crosses above the 200-day average, it often signals the start of an upward trend and is considered a bullish signal. In SHIB’s case, the last golden cross led to a massive price surge, with the token climbing over 450% from December 2023 through March 2024.
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This pattern had investors hopeful for a similar outcome this time around, as a fresh golden cross emerged on the SHIB chart.
Recent Price Correction and Market Conditions
Despite this bullish indicator, SHIB experienced an 80% increase in the past 10 days before the recent formation. Analysts view the recent two-day dip as a necessary price correction. This dip aligns with broader market sentiments, as the release of today’s Consumer Price Index (CPI) report creates added pressure on assets, including cryptocurrencies. The CPI report, a key macroeconomic indicator, often influences investor behavior, causing them to adopt a more cautious approach before major financial updates.
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While the golden cross typically signals growth potential, SHIB’s response this time highlights the impact of short-term market factors. As the CPI report causes fluctuations and risk aversion, investors are closely monitoring SHIB’s behavior. Once the report’s influence diminishes, it will be interesting to see whether SHIB can leverage the golden cross to drive a renewed upward trend.
The market’s reaction will provide insights into whether SHIB’s golden cross retains its growth potential amid shifting market dynamics.
