Shiba Inu coin price has not been left behind in the ongoing crypto sell-off. The SHIB token has crashed for two consecutive days, moving to its lowest level since November 27. It has dropped by over 27% from its highest level this year, meaning it has moved into a technical bear market.
Why Shiba Inu coin price crashed
SHIB price retreated sharply because of the ongoing sell-off in the crypto industry, which was triggered by the Bitcoin crash. Bitcoin, the biggest crypto in the industry, dropped to $95,000 a week after it soared to a record high of $104,000.
It is normal for cryptocurrencies and other assets to suffer a big reversal after hitting a key resistance level. For example, the Dow Jones index rose to $40,000 for the first time on May 17 and then dropped by 5% in the next few days.
Similarly, Bitcoin price rallied to a record high of $73,686 in March this year. It then retreated by 33% to a low of $49,800 in August. Most altcoins usually drop sharply after rising to a record high.
Shiba Inu coin price has also dropped ahead of the upcoming US inflation data, which will help to determine the next Fed action. Economists expect the data to show that the headline Consumer Price Index (CPI) rose slightly in October.
A higher inflation report means that the Federal Reserve may decide to maintain a hawkish tone when it meets next week.
Shiba Inu price has also dropped as the futures open interest dropped to $92 million from this month’s high of $184 million. Futures open interest is a sign of waning demand among traders.
SHB price outlook is still bullish
Technicals suggest that the SHIB price has a bullish outlook. The daily chart shows that Shiba Inu’s price has pulled back in the past few days. This retreat is notable because it happened after it rose to the key resistance level at $0.00003276, its highest level on March 28. This price was also the upper side of the cup and handle pattern.
Shiba Inu price is now in the process of forming the handle section. It has also remained above the 50-day Exponential Moving Average and the lower side of the ascending channel.
Therefore, the outlook for the Shiba Inu coin is bullish. The initial target is the upper side of the cup at $0.0000327. A move above that level will lead to more gains. The next point to watch is $0.000045, which is about 77% above the current level.
