The price of SHIB, the native token of the Shiba Inu ecosystem, has been fluctuating near major daily support at $0.000007 level recently. Traders are wondering if a rise in price is on the horizon.
Technically, the SHIB price has formed a W pattern on its chart. If the neckline of this pattern is broken correctly after testing the area as support, it could signal a bullish breakout and present an opportunity to open a long position with a prudent stop loss.
The momentum indicators are showing mixed signals currently, according to altFINS. The MACD line is above the MACD signal line, which is bullish. However, the RSI is below 45, which is in bearish territory. So momentum is not clearly pointing one way or the other.
Previously, SHIB price broke out bullishly from an ascending triangle pattern, reaching a high of $0.0000115 which was the measured target from the breakout pattern. However, subsequently SHIB pulled back and broke below the $0.000008 support level, which is where the prior bullish breakout had occurred from. This breakdown opens up downside risk potentially back towards the aforementioned support zones.
Fundamentally, an analysis of Shiba Inu’s token economics reveals that its inflation rate may be relatively high, which could put downward pressure on its value over time. However, its monetary mass does not appear to be overly centralized, which provides some balance in terms of token distribution.
Shibarium, the Layer 2 scaling solution being developed for the Shiba Inu ecosystem, is generating significant transaction volume already in its testnet phase. With over 3 million transactions in total, it will be interesting to observe if the growth in transactions correlates with more new accounts and overall activity as Shibarium approaches mainnet launch.
The number of deployed and verified smart contracts on Shibarium, which stands at 30 today, offers insights into the development work occurring on the blockchain. Monitoring how the daily deployment of new contracts progresses will provide perspective on the evolution of Shibarium’s overall ecosystem.
As Shibarium nears its full mainnet launch, the performance of its testnet provides signals about the potential adoption and usage of this Layer 2 solution. The development activity indicated by new contract deployments lays the foundation for the types of decentralized applications that may eventually run on top of Shibarium and expand its capabilities.
Both technical and fundamental analysis offer valuable perspectives on anticipating potential price movements and developments for the Shiba Inu ecosystem and its SHIB token. The conflicting technical signals suggest traders should wait for stronger directional bias to emerge before putting on big positions.
Meanwhile, monitoring key ecosystem metrics like Shibarium adoption provides the fundamental backdrop that will likely impact SHIB price in the medium-to-long term.
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