Will This Shiba Inu (SHIB) Price Pattern Start Reversal?

U.Today - Shiba Inu is currently showcasing a price pattern that could potentially lead to a reversal. The pattern, characterized by SHIB breaking below the 200-day Exponential Moving Average, might be indicating an opportune moment for investors and traders to consider dollar-cost averaging (DCA) into their positions.

The 200-day EMA is a critical long-term indicator that many investors watch to determine market trends. A break below this line can often suggest bearish sentiment. However, for the astute investor, this can also present an attractive entry point, especially for those looking to DCA or accumulating during dips in anticipation of future gains.

Despite the current breach, SHIB's approach to this level has historically been met with a strong reaction from buyers, sometimes resulting in a notable price reversal. If the pattern holds true to its historical behavior, the price of SHIB may soon find sufficient support to halt the decline and initiate an upward trajectory.

Nonetheless, it is crucial to acknowledge that SHIB has been facing consistent selling pressure, evident every time there is an attempt to push the price higher. This consistent sell-off following attempts to rise has created a challenging environment for SHIB to sustain any substantial gains.

The current market scenario for SHIB is a delicate balancing act between bearish pressure and the potential for a bullish reversal. For new investors looking to enter the market, the area just below the 200 EMA could prove to be a significant level, provided they are comfortable with the inherent risks involved with such volatile assets. Older investors can use the price level to dollar cost average their holdings.

Solana loses steam

The chart reveals that Solana has decisively exited its previous uptrend, characterized by higher highs and higher lows, and has entered a correction phase. The volume profile during this downturn suggests that the selling pressure has intensified, leading to a breakdown below critical support levels. This pattern is often a precursor to further declines as market confidence wanes.

For those looking for a scenario in which Solana could rebound, a relief rally could emerge from oversold conditions, indicated by RSI approaching lower bounds. Such a rally would require a catalyst, possibly in the form of positive developments within the Solana ecosystem or broader crypto market sentiment shifts. A rebound scenario might also be supported by traders looking for value buys at lower price points, thus creating sufficient buying pressure to counter the recent downtrend.

Ethereum meets substantial support

The 50-day EMA has historically been a stronghold for Ethereum's price, acting as a pivot point between the bullish and bearish territories. After a period of decline, Ethereum's approach to this level suggests that we may be on the cusp of a reversal. This is particularly compelling given Ethereum's past performance, where touches of the 50 EMA have often led to a resurgence in buying activity, driving the price upward.

Currently, the intersection with the 50 EMA aligns with a descending trading volume, indicating a potential decrease in selling pressure. This trend could signify market consolidation before a bullish reversal, as lower volume alongside support touchpoints often precedes a shift in momentum.

The implications of this volume decrease are twofold. First, it may suggest that the recent sell-off is losing steam, and the market is running out of sellers at current price levels. Second, it may imply that the market is awaiting further catalysts or developments within the Ethereum ecosystem, such as updates on Ethereum 2.0 or broader crypto market trends, before initiating the next significant move.

This article was originally published on U.Today