According to the analyst, the Shiba Inu (SHIB) broke the “cup and handle” pattern on August 14. Thus, it raised hopes for additional gains in the coming weeks. Here are the details…
Analyst: Shiba Inu could rise 50 percent
According to analyst Yashu Gola, a “cup and handle” appears when the price falls and rises in a U-shaped trajectory in the first phase, followed by a rapid sideways or downward movement in the second phase. Specifically, the price trend develops under a common resistance level. Typically, cup and handle patterns dissolve after price breaks above the resistance level. According to the analyst, SHIB rose 27 percent to $0.000016 as shown below. After that, he did the same on August 14.
Analyst points to technical analysis rules. According to the technical analysis rule, the distance between the lowest point of the pattern and the resistance line is measured. Then, a “cup and handle” breaking target is determined by adding it to the break point. As a result, SHIB is likely to head towards $0.000002253 according to Gola. This equates to a 50 percent price increase. The analyst uses the expressions “50 percent price increase until September”.
Would that be a ridiculous rally for SHIB?
Basically, there was only one catalyst in the Shiba Inu’s intraday price rise of 27 percent on August 14. It was also a metric that showed SHIB’s burn rate increased 825 percent in one day. However cryptocoin.com As we also reported, the amount of SHIB burned is just over $4,500. Overall, however, the Shiba Inu network has burned over $6.36 million in SHIB tokens since launching.
Additionally, the Shiba Inu rally comes almost ten days after Binance announced that it will add SHIB support to payment cards issued in Europe. Thus, the crypto exchange has increased the potential of SHIB to find new users in the emerging European cryptocurrency space. According to the analyst, weak fundamentals are stabilizing SHIB’s technical uptrend. However, according to veteran analyst Tom Bulkowski, cup and handle patterns do not directly reflect profits. It should be noted that the formation has only a 61% success rate in meeting its profit targets.
Therefore, he points to the possibility of a failed cup and handle breakout with a pullback from the 200-day exponential moving average (200-day EMA) near $0.00001755. There are chances of SHIB seeing an initial correction towards $0.00001306. According to Gola, Shiba Inu’s “cup and handle” pattern may fail due to the overbought daily relative strength index (RSI) of the token. According to the analyst, SHIB’s RSI has climbed above 70, which typically results in a period of horizontal consolidation or correction.
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