SHIB Coin Price Uptrend a Bull Trap as Bearish Setups and Whale Exits Haunt the Memecoin

Shiba Inu (SHIB) coin prices have been on an uptrend since Sept. 6, possibly convincing traders that the token had bottomed out and a bull run was on the horizon. The uptrend saw SHIB coin price spike nearly 10% to reach a daily high near $0.0000135

Shiba Inu (SHIB) coin prices have been on an uptrend since September 6, leading some traders to believe that the token has bottomed out and a bull run is about to begin. This uptrend saw SHIB coin prices spike nearly 10% to reach a daily high of around $0.0000135.

However, the token is still facing bearish pressures, with technical indicators and whale movements suggesting a less than promising future for the memecoin.

Bearish Technical Setups Haunt SHIB Coin Prices

The SHIB/USD pair has formed a bearish technical pattern known as the 'head and shoulders pattern' within a descending channel.

The head and shoulders formation is characterized by a higher peak (the head) between two lower peaks (the shoulders), indicating a potential trend reversal from bullish to bearish. The neckline of this pattern is at around the $0.00001274 level.

After forming the right shoulder, the SHIB coin price is seen testing this level. At press time, it is trading at around $0.00001356.

The broader descending channel has been in place since March 2024, adding further bearish pressure. Throughout this channel, SHIB’s price has been making lower highs and lower lows.

A confirmed break below the neckline could trigger further declines. This decline, based on the height of the head and shoulders formation, could see Shiba Inu coin prices drop by nearly 22%, targeting the $0.00000994 level. This target coincides with the lower boundary of the descending channel, amplifying the bearish outlook.

However, if SHIB manages to defend the neckline and bounce back, the price might attempt to retest the upper channel resistance. But the overall technical picture remains bearish unless the price breaks above the upper boundary of the channel.

It's Not Just The Technicals

Recent Santiment data reveals a clear decline in whale activity for the Shiba Inu coin, indicating bearish sentiment.

Large holders with 100 million to 1 billion SHIB (yellow line) and 10 million to 100 million SHIB (pink line) have been continuously reducing their holdings over the past few months. This decline is particularly evident in the 100 million to 1 billion SHIB bracket, which has seen a sharp decrease in holdings.

This drop suggests that major investors are exiting, which is often viewed as a bearish signal due to their significant influence on market movements.

In the same vein, holders of 1 million to 10 million SHIB (blue line) are gradually selling off, further bolstering the negative outlook. While smaller holders in the 100,000 to 1 million SHIB range (red line) are accumulating, their impact on the market is much smaller than that of the whales.

Thus, it seems likely that the Shiba Inu coin is due for a correction, making the recent rally a perfect bull trap for the unwary trader.

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