Shiba Inu (SHIB) Price May Enter a Period of Max Pain Followed by a Bullish Surge Exceeding 500%

Shiba Inu price has been diverging from the broader market over the last two weeks, trending lower as the other crypto assets followed Bitcoin's erratic swings.

Shiba Inu (SHIB) price has diverged from the broader crypto market over the last two weeks, trending lower as other crypto assets followed Bitcoin’s (BTC) erratic swings. Despite Shibarium chain developments, SHIB volume has dwindled to new lows, a weakness that is also reflected in its price.

An analysis of futures trading data and price action reveals that SHIB price may enter a period of max pain followed by a bullish surge exceeding 500%.

Shiba Inu Price Set For Massive Move, But Which Way?

Shiba Inu price has been in a downtrend since early April, following a massive rally that saw SHIB price multiply by over 100x in a matter of months. The downtrend began to accelerate in June, as SHIB price fell sharply from a high of around $0.00003.

The downtrend has since stalled, with SHIB price trading in a narrow range over the last two weeks. However, the weakness in SHIB price is evident, as volume has continued to dwindle.

According to Messari Research, SHIB real volume hit a 1-year low on August 18, suggesting that investors may not find SHIB as interesting as it once was.

An analysis of futures trading data and price action reveals that SHIB price may enter a period of max pain followed by a bullish surge exceeding 500%.

According to the Coinglass Crypto Derivatives Visual Screener,Shorts are opening up as SHIB futures open interest shifts towards the downside. This usually happens when traders are anticipating the price of the underlying asset to continue dropping in the coming days.

Shiba Inu technical analysis reveals a 50% potential price drop in line with the rising sell pressure, but what follows after that would be a price surge that would send SHIB up over 500%.

Shiba Inu Price Chart Shows Potential For 500% Surge After Max Pain - SHIB Spot Open Interest In Billions

Continuing the analysis on a SHIB price technical analysis chart, we can see that the Shiba Inu price is trading within a descending channel on the 1-day timeframe, indicating a sustained bearish trend.

The SHIB price is positioned at the lower boundary of the channel, suggesting strong downward pressure.

Fib levels are also plotted on the chart, with the 0.618 Fib level providing resistance at around $0.000015. If SHIB price manages to break above this level, it could rally up to the 0.786 Fib level at around $0.000019.

From there, SHIB price may encounter further resistance at the 0.886 Fib level at around $0.000028, before finally reaching the 1 Fib level at around $0.000037.

Shiba Inu price is also facing resistance from the 50-day moving average (MA), which is currently at around $0.000013. If SHIB price can break above this level, it would signal a potential trend reversal to the upside.

However, if SHIB price continues to trade within the descending channel, it could indicate a bearish continuation. In this case, SHIB price may fall to lower support levels at around $0.000012 and $0.000010.

Candlestick analysis reveals spinning top formation, which indicates market indecision, with neither bulls nor bears in clear control. However, given the downtrend, the lack of a strong reversal pattern suggests the downtrend could continue unless significant buying pressure emerges.

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