Shiba inu price analysis 27 October: Is the rally over?

Shiba inu is overbought in the short term.

                                
An anonymous crypto whale’s purchase of over 270 billion shiba inu tokens has boosted the coin’s ranking – Image: Shutterstock
                                

Shiba inu (SHB) has become the 11th largest cryptocurrency with a market capitalisation of over $28bn (£20bn) and from its low, the meme coin is up a whopping 95.7 million percent, according to CoinGecko data. The coin has continued its northward march with a more than 600% rally in October.

The latest surge in the token on 26 October may have been triggered by the purchase of 276.6 billion shiba inu tokens by an anonymous crypto whale, according to data from WhaleStats. After the latest purchase, the whale owns 316.5 billion shiba inu coins. 

A Change.org petition requesting Robinhood to include shiba inu has garnered more than 334,000 signatures at press time. Robinhood’s CEO, Vlad Tenev, said during the firm’s earnings call on 26 October that it was “carefully” looking at new coins to include on its platform.

The popularity of shiba inu can be gauged from the fact that it ranks as the third-most googled cryptocurrency year-to-date, with an average 2.8 million searches per month, according to a recent study by Bacancy Technology. Bitcoin, with a 22 million average monthly search volume and ether, with 6.3 million searches, occupies the top two spots.

Could the buying frenzy sustain? Will shiba inu go up further from the current levels? Let’s see what charts project. Read our SHIB price analysis to find out.

Shiba inu price technical analysis: daily chart

Daily price chart – Credit: Currency.com
Daily price chart – Credit: Currency.com

SHIB’s price formed a pennant after rallying from a low of $0.00000683 on 1 October to $0.00003402 on 7 October. The bulls pushed the price above the pennant on 18 October and the momentum picked up on 23 October.

The bears tried to trap the aggressive bulls on 24 October as seen from the long wick on the day’s candlestick, but the buyers did not relent. The SHIB/USD pair formed an inside-day candlestick pattern on 25 October, which resolved to the upside on 26 October.

This suggests that demand exceeds supply and the trend is firmly in favour of bulls. The sharp up-move of the past few days has pushed the relative strength index (RSI) above 87, indicating that the rally is overheated in the short term. This could result in a few days of consolidation or a minor correction. 

However, if the bullish momentum continues, the rally could reach the 161.8% Fibonacci extension level of $0.00006405. The shiba inu price analysis shows that bulls are in the driver’s seat but the rally is overextended in the short term.

Shiba inu price technical analysis: 4-hour chart

4-hour price chart – Credit: Currency.com
4-hour price chart – Credit: Currency.com

SHIB’s price turned down from $0.00005792 but the bears could not pull the pair below the 20-exponential moving average (EMA). Both moving averages are sloping up and the RSI is in the overbought zone, indicating that bulls are in control.

If buyers push the price above the all-time high at $0.00005792, the uptrend could resume and reach $0.00006405. This level may act as a stiff resistance but if bulls overcome this hurdle, the next stop could be $0.00007275.

The first sign of weakness will be a break and close below the 20-EMA. Such a move will indicate that traders may be rushing to the exit. A break and close below the $0.00004306 support will suggest a possible trend change. That may open the doors for a possible drop to the 50-simple moving average.

Shiba inu buy or sell at current levels

Shiba inu’s price analysis shows that the pair is in a strong uptrend but the relative strength index has risen deep into the overbought territory. This suggests the pair could enter a consolidation or correction in the short term. The critical support to watch on the downside is $0.00004306. A break and close below this level could signal the start of a deeper correction.

The views and opinions expressed in the article are those of the author and do not constitute trading advice. Trading and investing involve substantial risks and you should do your own research or contact your financial advisor before arriving at a decision.

Shiba Inu to Bitcoin
Daily change
0.000000000752
Low: 0.000000000738
High: 0.000000000766

Further reading

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