Shiba Inu (SHIB) appears to be undergoing a reset rather than experiencing a market failure. After being rejected near the $0.000009 level, SHIB managed to stabilize above the 26 Exponential Moving Average (EMA). This shift indicates that the price is not plunging into a continuation of a downward trend but is instead recalibrating for a potential recovery. The rejection at this level was expected, as it coincides with resistance from several higher moving averages. Despite this, SHIB quickly found support, an important development that sets it apart from typical bearish breakdowns.
The lack of an immediate sharp decline following the rejection suggests a cooling of selling pressure rather than an increase. During this period, volume declined rather than spiking, signaling that sellers are losing their hold. SHIB’s price remained above the 26 EMA, acting as a dynamic pivot point, which serves as a critical threshold for trend continuation. Historically, when SHIB holds above this level after a sell-off, it often leads to multi-week recoveries, especially when the broader market sentiment is not overly risk-averse.
Momentum Indicators Support SHIB’s Recovery
Momentum indicators offer further support for the idea that SHIB is not on the brink of a breakdown. The Relative Strength Index (RSI) has pulled back from its regional highs but has not reached oversold conditions. This indicates a cooling of momentum rather than a breakdown, signaling that the market could be in a strengthening phase.
Currently, SHIB is consolidating between short-term support at the 26 EMA and overhead resistance formed by the 50-100 EMA cluster. As the price remains above the critical 26 EMA, the likelihood of a price breakout increases once the market sees renewed volume. While the reset phase might not immediately lead to a sharp price increase, it sets the stage for potential upward movement, provided SHIB can maintain its position above the 26 EMA.
Despite the rejection at $0.000009, the market’s structure and volume patterns are more favorable for recovery than for a significant sell-off. As long as SHIB can defend the 26 EMA and avoid a breakdown with high volume below this level, the path to recovery remains intact.