- Shiba Inu (SHIB) has given a strong breakout on the falling wedge pattern hinting at the possibility of another 75% rally from here.
- Shiba Inu’s development with Shibarium’s launch has also fueled the rally in the SHIB cryptocurrency.
The world’s second-largest memecoin Shiba Inu (SHIB) has been showing strong momentum recently in the market with its price surging by 17% in Wednesday’s market bounce. Interestingly, since the beginning of 2022, the SHIB price is up by more than 60% registering its highest price level since November 2022.
Based on the technical chart and the relative strength index (RSI) reading, Shiba Inu has been an excessively bought asset on a daily timeframe. On Wednesday, January 18, the RSI reading jumped to 86, which is 16 points above the overbought threshold of 70.
Courtesy: TradingView
Usually, an overbought RSI might prompt investors to book profits and unload their positions leading to price correction. Thus, Shiba Inu might drop back to its 300-day moving average of $0.00001120 as represented by the blue line in the above chart. As of press time, SHIB is trading at $0.00001123, just above its 200-day moving average.
But if the SHIB price holds this 200-DMA as support, the SHIB price rally might also continue. Besides, on the weekly chart, there’s a clear formation of a bullish reversal pattern. Dubbed the falling wedge, this pattern builds up with the price trending lower inside a range defined by the descending, converging trendlines.
If the price break above the upper trendline, it can be considered a bullish signal with further price gains ahead. Below is the chart of how the SHIB price action has given a breakout above the “falling Wedge”. As a result, SHIB can further extend the gains toward $0.00002063 by March 2023, which is another 75% from the current levels.
Courtesy: TradingView
The Shiba Inu Price Rally
The recent rally in the price of Shiba Inu (SHIB) amid optimism led by cooling inflation and favorable macro conditions. Bitcoin and the broader altcoin space have registered good gains since the beginning of 2023.
Besides, a majority of the Shiba Inu price gains come after Jan. 16 as the SHIB price has gained over 25%. Another solid reason for Shiba Inu to pick up momentum is their announcement of the upcoming beta release of its Layer-2 scalability platform Shibarium.
As said, Shibarium is a Layer-2 network that would rest atop the Ethereum blockchain. In other words, Shibarium would allow developers to build and launch decentralized applications (DApps) while seeking improved network scalability and lower transactional costs.
In their announcement, Shiba Inu noted that “Shibarium’s Layer 2 blockchain protocols can serve different industry areas such as metaverse, web3 innovation, and gaming”. Besides, Shiba Inu recently announced that Shiba Inu will have a dedicated SHIB burn protocol which will take out coins from the circulating supply leading to price gains.
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