Key Insights:
- Shiba Inu forms a falling wedge pattern with RSI at oversold levels, hinting at a possible rebound.
- A 10,527% spike in SHIB burn rate removes over 171 million tokens from circulation within a day.
- Key support at $0.00000708 holds as price approaches resistance at $0.00001030 in a potential reversal scenario.
Shiba Inu’s price continued its decline this week, reaching its lowest point since October 2023. The token has lost over 85% from its 2024 peak, placing it among the worst-performing digital assets so far this year. Despite this drop, chart patterns and technical indicators suggest a possible short-term reversal.
On the technical front, the SHIB chart has gradually formed a falling wedge pattern. This structure, marked by converging downward trendlines, typically precedes a breakout. The token is approaching the confluence of these lines, signaling that a potential rebound may be near.
Oversold RSI and MACD Show Reversal Signals
Momentum indicators further support this view. The Relative Strength Index has fallen to the oversold threshold of 30, a level last seen in March 2023. That drop was followed by a nearly 70% rally. Additionally, the MACD appears to be forming a bullish divergence, with the indicator climbing as the price continues to fall.
Source: TradingView
The token is currently testing a key support level around $0.00000708, a price area that held firm in June and October 2023. This support has so far prevented deeper losses. If this floor continues to hold, a move toward the resistance level at $0.00001030 remains likely. That level acted as the lowest swing in April, July, and August of 2024.
Burn Rate Jumps by Over 10,000 Percent
One of the major developments supporting the bullish case is the sharp spike in SHIB’s burn rate. In the past 24 hours, over 171 million tokens were burned, marking a 10,527% increase. A single wallet accounted for the entire burn, sending the tokens to an inaccessible address. Shiba Inu has burned over 410 trillion tokens to date, reducing the circulating supply to approximately 585 trillion.
Broader macroeconomic trends may also favor SHIB. Expectations of Federal Reserve rate cuts could renew interest in risk assets. Additionally, proposed stimulus measures in the United States, including discussions around $2,000 checks tied to tariff revenues, could increase retail liquidity, although legislative approval remains uncertain.
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