Shiba Inu (SHIB) Poised for a Major Turnaround, Targeting a 2X Surge This August

Shiba Inu may be on the cusp of a major turnaround, driven by the formation of an engulfing candle and the support provided by a long-standing trendline.

Shiba Inu (CRYPTO: SHIB) is displaying a bullish engulfing candle on the 1-day chart, signaling a potential breakout from a bearish channel pattern.

As the cryptocurrency market recovers from recent losses, memecoins have once again taken center stage. Among them, Shiba Inu has been making headlines with its price movements and plans for the future.

Being the second-largest meme coin by market capitalization, SHIB boasts a strong community and increasing support, highlighting its significant underlying potential.

With aspirations to enter the decentralized finance (DeFi) and Layer-2 arenas, the Shibarium project is a pivotal component of the Shiba Inu ecosystem. A recent update confirmed that Shibarium is set to introduce an automated token burn mechanism, similar to those employed by leading projects in the sector.

As Shiba Inu's role in the crypto landscape continues to evolve, one must ponder if it can transcend its label as a mere meme coin and more critically if the current bullish momentum in SHIB can translate into a twofold increase this month.

Shiba Inu Is Constrained by a Bearish Channel Formation

Analyzing the 1-day logarithmic price chart, Shiba Inu showcases a distinct formation of lower highs and lower lows, illustrating a descending channel pattern.

Amid the recent market corrections, SHIB experienced a pullback that tested its support trendline, leading to a negative cycle. However, a strong price rejection from the $0.000010 psychological support level indicates that Shiba Inu buyers are asserting control over this trendline.

As the market begins to recover, $SHIB's price formed a bullish engulfing candle, achieving an 11% intraday increase. As this recovery phase progresses, the MACD and the signal lines have surged out of the oversold territory, highlighting a bullish divergence during the last couple of dips.

Additionally, the moving averages are gearing up for a bullish crossover, suggesting further potential for an upward trend. The DMI indicator currently reflects a bearish sentiment due to the VI lines, which continue alongside a rising ADX line.

Nevertheless, the recent recovery has sparked a slight convergence in the VI lines, hinting at the possibility of a favorable crossover soon.

Shiba Inu (SHIB) Burn Rates and Transactional Activity Surge

According to a recent update from the community burn tracker Shibburn, over the past 24 hours, an impressive 105,981,775 SHIB tokens have been burned, showcasing a staggering increase of 137,411.87%.

In the past week, statistics reveal that 114,775,953 SHIB tokens have been removed from circulation, corresponding to a dramatic 366% rise. This surge in the burning rate may enhance the prospects for recovery.

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Can Shiba Inu (SHIB) Reach $0.00003?

At the time of writing, Shiba Inu is trading at $0.0000141. According to Fibonacci retracement levels, for the uptrend to gain momentum within the descending channel, the price must breach the overhead trendline. This breakout will serve as a critical indicator for buyers.

Should this bullish break occur, traders will likely set their sights on the 50% Fib level at $0.000022 or possibly the 61.80 at $0.00003, provided the momentum remains strong.

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