Two Early Signs Shiba Inu Could Enter a Bullish Phase

Shiba Inu is showing early bullish divergence signals as its price challenges a descending trendline, sparking optimism over a rebound.

Shiba Inu (SHIB) is beginning to attract attention as two early signs show a bullish development could be on the horizon. Chart data shows a bullish divergence on multiple momentum indicators, as SHIB is attempting to break above a descending trendline on the daily timeframe.

SHIB Momentum Indicators Show Improving Strength

Both the Relative Strength Index (RSI) and the Moving Average Convergence Divergence (MACD) are displaying bullish divergence, indicating momentum has improved. Shiba Inu continues to make lower lows, yet these indicators are making higher lows, a conflicting trend that suggests underlying strength.

This divergence became very noticeable last month. After an early dip to $0.00000430 on June 6, the RSI also dropped to 20. After a brief recovery, SHIB formed a low, dropping to $0.00000405 on June 26. However, the RSI didn’t make a new low but hit a higher low of 21.44.

At the same time, the MACD line trended upwards in a higher low pattern, aligning with the RSI. Its trend histogram also moved from red bars to green bars, printing longer bars last seen in March.

Notably, analysts often view this divergence as an early sign that selling pressure is fading. It usually precedes a strong market reversal to higher prices.

Shiba Inu Nears Descending Trendline Breakout

Meanwhile, SHIB is also pressing against a descending resistance line, making this a critical area to watch. The token has remained below this trendline since its high of $0.00000670 in May, with subsequent upside attempts capped near the line.

Today’s nearly 2% rise to $0.00000437 places SHIB on the cusp of a breakout. Should the current momentum persist, Shiba Inu could finally break above this multi-month resistance.

Interestingly, a successful breakout, followed by a close above the trendline, would strengthen the bullish case and confirm that buyers are beginning to regain control.

The target for this breakout is a potential 28% rally to the June high of $0.00000558. Further upside could take SHIB to the May high of $0.00000670, a 53% increase from the current market price.

Shiba Inu Accumulation Adds Momentum

Further bolstering the breakout optimism is the ongoing Shiba Inu accumulation trend. The CryptoQuant exchange netflow shows a negative figure of 131.88 billion SHIB in the past 24 hours, suggesting strong buying activity.

The total exchange netflows calculate the difference between inflows into and outflows out of exchanges. A negative figure shows more withdrawals than deposits. This means that users shifted Shiba Inu massively out of trading platforms into self-custody wallets, highlighting accumulation.