The reasons SHIB price fell over 50% and its next support
After a dizzying price increase, SHIB is down more than 51% from its all-time high, slipped from $0.000086 set on October 29 to $0.00004312 at press time.
Source: Tradingview
Here are some potential reasons behind SHIB’s sell-off today.
The broader market weakens
Of course, SHIB is not the only cryptocurrency facing selling pressure at the moment.
Bitcoin is trading near daily lows with bulls struggling to hold onto $60,000, a critical support level.
Dogecoin (DOGE), the dog-themed meme that inspired Shiba Inu also saw a 6% drop in the past 24 hours.
At press time, only BNB and SOL made gains of the day.
The listing ‘misses’
After experiencing a moderate correction at the end of the week, SHIB has had an impressive start to the week. On Monday, SHIB revisited $0.000075 after the Kraken exchange promised to list it on Tuesday.
However, Kraken seems to have delayed the plan despite strong support from the community, which stated that it considers listing in the future.
Robinhood, although has also sent some positive signals, has yet to take action on the SHIB listing rumor.
Strong take profit
Shiba Inu pullbacked after witnessing a huge rally in October and has secured huge profits for some holders.
Last week, Coinbase revealed that the average holding time for SHIB is just 11 days, meaning there is not yet a strong hold sentiment in the community. As a result, many investors are tempted to take profits.
Some holders panicked when a giant whale moved forty trillion, one hundred thousand of SHIB (40,000,000,100,000) to four different wallet addresses, each transaction was worth about $586 million, totaling about $2.3 billion as of Tuesday.
Furthermore, there are now unsettling similarities between SHIB’s chart and that of XRP, Nano, and several altcoins that recorded massive gains during the previous bull run.
Despite the recent correction, SHIB is still up 250% over the past month.
Where will SHIB find support?
Trader IncomeSharks tweeted a SHIB chart showing it is falling and is about to break down.
Source: Twitter
The six-hour chart shows that SHIB has broken down from a symmetrical triangle.
Additionally, it shows that the $0.000035 support area is extremely important, due to the confluence of factors such as the horizontal, which also coincides with the ascending support line and is the 0.786 Fib retracement support level. Therefore, if the SHIB slips to this level, it is likely to bounce back.
Source: TradingView
A closer look reveals that the SHIB is likely to trade inside a descending parallel channel. If so, it just bounced at its support line.
Furthermore, it is possible that the drop is a three-wave ABC structure. In this case, the A:C wave has an exact 1:1 ratio. Therefore, it is possible that meme-coin will reverse at current levels instead of dropping to $0.000035.
Source: TradingView
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