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Shiba Inu (SHIB) buyers failed to reverse the negative narrative despite a falling wedge breakout due to the coin's significant correlation with Bitcoin.
Since rebounding from the 61.8% Fibonacci level, the month-long trendline resistance (yellow, dashed) has limited the opportunity for purchasing rallies.
While the current setup demonstrated a negative bias, a closing above or below the trendline barrier could impact the future direction of the dog-themed cryptocurrency.
At the time of publication, SHIB was trading at $0.01075 per share, up 1.95 percent for the day. (From this point forward, SHIB prices are multiplied by 1,000 for brevity.)
SHIB Daily Chart
For more than four months, SHIB traded in a band between $0.02 and $0.032, while bears maintained pressure near the 38.2% Fibonacci line. However, the symmetrical triangle formation on the daily chart favored sellers due to the altcoin's recent decline.
SHIB dropped approximately 60 percent of its value (from 5 May) and plunged into its seven-month low on 12 May after falling below the $0.02 baseline.
As a result, the distance between the 20 EMA (red) facing south and the 50 EMA (cyan) reached a record high. In October of last year, during SHIB's bull run to its ATH, a similar gap existed.
In addition, SHIB has experienced a considerable decline in volume and a decline in volatility. Now, the upper and lower Bollinger Bands (BB) may encourage a somewhat tight period in the future.
The current lethargic behavior on the chart could be prolonged if the bulls are unable to break above the monthly trendline resistance. To gain access to the $0.013 level, SHIB had to break free from its immediate opposition.
Rationale
After failing to maintain itself above the 33-resistance for three weeks, the RSI has been hovering towards the oversold level. Unless the bulls overcome the 33-resistance, SHIB's chances of a robust recovery are minimal.
Should the CMF rebound from the -0.06 zone, its recent increase would confirm a negative price divergence.
Conclusion
With selling volumes outpacing buy orders and the near-term EMAs pointing south, SHIB could prolong its lethargic phase near $0.01045.
Any closing below this level would set the alt for more losses toward the lower BB band.
Moreover, the alternative cryptocurrency has a stunning 98 percent 30-day connection with Bitcoin. Keeping a watch on Bitcoin's movement in conjunction with the overall market attitude may be crucial for making a profitable move.
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