Shiba Inu (SHIB) is approaching a critical technical setup that has raised concerns among traders and analysts. The token is on the brink of forming a weekly death cross.
Weekly Death Cross and Its Significance
Shiba Inu is nearing the formation of a weekly death cross — a rare pattern that occurs when the 50-week simple moving average crosses below the 200-week moving average. This signal is associated with long-term market weakness and may lead to price stagnation or a slow price decline.
According to TradingView data, the 50-week moving average has already started turning downward, bringing it closer to intersecting the 200-week trend line. Confirmation of this crossover may occur within the next few weeks.
Key Support at $0.00001
So far this year, SHIB has repeatedly found support at the $0.00001 level. This zone has acted as a safety net during previous dips and is once again being watched closely. A strong defense of this level could limit downside risks.
Nevertheless, the general mood of the whole market is lowered, and trading volume exhibits weaknesses. Unless bulls regain control, SHIB remains prone to more consolidation or pullback.
Future Risks for Shiba Inu
Although not every weekly death cross contributes to an immediate crash, it is considered an indication that a bearish trend is gaining steam. Should the trend hold and sentiment not pick up momentum, SHIB may not easily experience its performance of reaching a high of $0.000045 in 2024.
As Shiba Inu moves closer to forming its first-ever weekly death cross, market participants are on alert. The coming weeks will be critical in determining whether SHIB avoids deeper losses or confirms the bearish signal.
The formation of Shiba Inu's first-ever weekly death cross signals potential further weakness in the market. Investor attention is focused on the key support level and potential implications for the token.
