On Friday, 14th August, Open Interest on Shiba Inu [SHIB] positions rose from $46.54 million the day before to $52.79 million. According to Coinglass, this hinted at a 13.4% hike. This speculative volume flood was accompanied by an uptick of 4.03% too.
That’s not all though as Coinalyze’s data revealed that spot demand for Shiba Inu has been steady lately. The weekend tends to see lower trading volume, but SHIB bulls might be able to drive a bigger rally next week if the spot and speculative buying pressure is maintained.
Let’s break down whether swing traders should adopt a bullish or bearish bias.
Short-term upward momentum shouldn’t fool SHIB bulls
In a recent report, AMBCrypto highlighted the bearish swing structure of Shiba Inu on the 1-day timeframe. The bounce in late July extended to $0.00000583 but only tested an overhead supply zone.
Since that bounce, the memecoin has fallen by 21.4% in three weeks.
A local support zone at $0.0000046 was flipped to resistance over the past week. The short-term upward momentum on Friday saw the popular memecoin surge into this overhead supply zone.
The H4 timeframe’s technical indicators showed bears had the upper hand at press time. The RSI was above the neutral 50-level after the recent price bounce, but momentum was not strongly bullish.
Meanwhile, the CMF remained below -0.05 for the majority of August. The capital outflows from the market have been considerable, according to the indicator.
As it stands, the sustained demand needed to break the supply zone is not at hand.
Traders’ call to action – Sell
The retest of the overhead supply zone, on the back of a quick uptick in volume, might be an ideal selling opportunity.
According to Coinglass’s heatmap, the price has swept the overhead liquidity. There is another cluster of short liquidations just below $0.0000048 that could be targeted over the weekend before a bearish move. A test of this area would also present a selling opportunity.
The evidence at hand strongly alluded to further losses for Shiba Inu.
The less likely scenario is a Bitcoin [BTC] rally bolstering altcoin market sentiment. A SHIB price move past $0.00000518 would shift its short-term bias bullishly again.
Final Summary
- Shiba Inu saw strong short-term bullish momentum on Friday.
- Bounce appeared to be only a retest of an overhead supply zone.
