Shiba Inu (SHIB) broke out of its prevailing cup-and-handle pattern on Aug. 14, raising its prospects of securing additional gains in the coming weeks.
Shiba Inu could soar 50%
A cup-and-handle appears when the price falls and rises in a U-shaped trajectory in the first stage, followed by a swift move sideways or downward in the second. Notably, the price trend develops under a common resistance level.
Typically, cup-and-handle patterns resolve after the price breaks above the resistance level; SHIB did the same on Aug. 14 after rising 27% to $0.000016, as shown below.
Per the rule of technical analysis, a cup-and-handle breakout target is determined by measuring the distance between the pattern’s lowest point and resistance line and adding it to the breakout point. As a result, SHIB could head toward $0.00002253.
In other words, a 50% price rally by September.
A nonsense rally, nonetheless?
Fundamentally, Shiba Inu’s 27% intraday price rally on Aug. 14 had no visible catalysts except a metric showing that SHIB’s burn price surged by 825% in a day. However the quantity of burned SHIB is value solely over $4,500.
On the entire, nonetheless, the Shiba Inu community has burned over $6.36 million value of SHIB tokens in its lifetime.
As well as, the Shiba Inu rally got here virtually ten days after Binance’s announcement so as to add SHIB help on its fee playing cards issued in Europe. In doing so, the crypto alternate raised SHIB’s potential to seek out new customers within the rising European cryptocurrency house.
We’re happy to announce that @binance has added SHIB to the checklist of supported tokens for the Binance Card issued in Europe.
Now you can pay with SHIB at 60+ million retailers worldwide. Moreover, rise up to eight% cashback and 0 annual or FX charges!https://t.co/0Xj7IXPyt0 pic.twitter.com/FqINtnHFWx
— Shib (@Shibtoken) August 5, 2022
Weak fundamentals might offset SHIB’s technically bullish bias, nonetheless, on condition that cup-and-handle setups have solely a 61% success price in assembly their revenue targets, according to veteran analyst Tom Bulkowski.
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Subsequently, a failed cup-and-handle breakout—additionally on a pullback from the 200-day exponential shifting common (200-day EMA; the blue wave within the chart under) close to $0.00001755—might have SHIB eye an preliminary correction towards $0.00001306, down 20% from the worth on August 14.
Shiba Inu’s cup-and-handle setup might fizzle due to the token’s overbought day by day relative power index (RSI). Notably, the RSI has crossed above 70, which usually leads to a interval of sideways consolidation or correction.
The views and opinions expressed listed here are solely these of the writer and don’t essentially replicate the views of Cointelegraph.com. Each funding and buying and selling transfer entails threat, you must conduct your personal analysis when making a call.
