Shiba Inu Struggles as Price Drops Below Crucial EMA Support

Shiba Inu (SHIB) was gradually gaining traction in the market, appearing well-positioned for an upcoming bounce. However, the situation changed rapidly, faster than anyone anticipated. The price dropped below the crucial 50-day EMA (Exponential Moving Average) and has not rebounded since.

Currently, SHIB’s position remains uncertain due to this abrupt decline. A break below the 50 EMA, a critical support level, indicates that sellers are gaining the upper hand. The 200 EMA, which is currently delicately holding the line below, now serves as the next major support.

Increased Selling Volume And Bearish Trend

If bears continue to exert pressure, SHIB may test the 200 EMA and potentially decline even further. Notably, selling volume increased significantly as SHIB broke below the 50 EMA. This surge in selling may signal that traders are cutting their losses due to waning confidence, a trend that could intensify.

Additionally, on this downward trend, the RSI (Relative Strength Index) is currently hovering just above the oversold area. While this suggests SHIB is oversold, it does not guarantee a rebound. Technical analysis heavily relies on moving averages, which are currently unfavorable for SHIB. The 20 EMA has made a bearish crossover below the 50 EMA, a pattern that frequently signals impending declines.

Monitoring Major Support Levels

Furthermore, the price is currently trading below all major moving averages, a generally very bearish indication. Based on the current price movement, SHIB requires a significant uptick to prevent additional losses. Ideally, it would quickly regain the 50 EMA to restore market confidence.

Traders should closely monitor the 200 EMA as a potential support level. If SHIB fails to hold above this level, they should brace themselves for further downside. The importance of swiftly regaining the 50 EMA cannot be overstated, as it would help bolster market confidence and potentially stabilize the price.

We are on twitter, follow us to connect with us :- @FXCryptoNews
— FXCryptoNews (@FXCryptoNews) December 14, 2023

SHIB’s recent performance suggests heightened caution among traders. The bearish signals, combined with increased selling volume and unfavorable technical indicators, indicate that SHIB may face further challenges unless it can quickly reclaim crucial support levels.

Disclaimer: The information in this article should not be considered financial advice, and FXCryptoNews articles are intended only to provide educational and general information. Please consult with a financial advisor before making any investment decisions.