- SHIBUSD bounce back stalls.
- SHIBUSD trading in a tight range.
- Factors that could drive SHIBUSD higher or lower.
Shiba Inu, the self-proclaimed “DOGE killer,” has been on a wild run over the past year. Until October of last year, the meme coin was up by more than 1500%, making it one of the best performing in the ever-volatile crypto landscape.
SHIBUSD technical analysis
Amid the meteoric rally to record highs, it appeared the meme coin was headed to the elusive $0.01 a coin level. Fast forward, the hype seems to have fizzled. Shiba Inu has given up more than 60% of the gains from all-time highs and looks to be under immense pressure. A drop from record highs of $0.000087 to lows of $0.000030 continues to arouse concerns among crypto enthusiasts.
Will Shiba Inu ever bounce back to all-time highs, let alone become a $0.01 coin? Well, that’s the million-dollar question as there are a number of key levels SHIBUSD needs to scale before turning bullish after the recent slump.
After plunging to three-month lows of about $0.000017, SHIBUSD has bounced back amid an uptick in buying pressure in the broader crypto market. However, the bounce-back has stalled on the pair hitting strong resistance near the $0.000035 level.
Bulls have struggled to steer a rally past the $0.000035 resistance level from which bears have come into the fold and tried to push SHIBUSD lower. As it stands, it remains range-bound trading in a tight trading range of between $0.000034 and $0.000028 level.
For SHIBUSD to turn bullish, a daily close above the $0.000035 is necessary. On the flip side, a daily close below the $0.000028 could reignite renewed sell-off that could result in the pair plunging back to lows of $0.000020.
Why SHIBUSD could rally?
While SHIBUSD has shed a significant amount of market value following the pullback from record highs, prospects of it bouncing back are still high. For starters, the 60% pullback looks like an ideal entry point on the risk-reward front, especially for traders and investors who missed out on the initial leg to all-time highs.
Supporters are also calling for a rebound amid growing talks about the Shiba Inu metaverse push. The metaverse push is positive, strengthening the meme coin sentiments in the market backed by a Shiba Army of more than 1.1 million with strong, unique addresses.
The development team taking the necessary steps to boost the token’s utility could potentially make it more valuable. ShibaSwap decentralized exchange has already created an avenue for increased staking of the token through which users can earn rewards.
The bear case
Strong competition is one of the biggest headwinds that could derail the SHIBUSD rally back to record high and onto becoming a $0.01 coin. The coin and project use cases are currently quite limited compared to other more established projects.
While Shiba Inu is a payment coin, it’s only used as a form of exchange and does not support decentralized applications such as non-fungible tokens. In addition, it is not suited for decentralized finance. Therefore, it cannot take on the likes of Ethereum, Solana, and Cardano that are shaping the world of decentralized applications.
As a payment network, Shiba Inu faces stiff competition from the flagship cryptocurrency Bitcoin. While it has gained substantial market value over the past few years, it still lags Bitcoin.
If SHIBUSD is to continue edging higher, then Shiba Inu will need more utility and move away from being a hype coin. The coin was not created to solve any specific problems, as is the case with Bitcoin and Ethereum. Therefore, once the hype dust settles, the meme coin could be in trouble.