Shiba Inu Consolidates Alongside Dogecoin In This Pattern: A Technical Analysis Of The Crypto
Shiba Inu SHIB/USD was trading flat in consolidation during Thursday’s 24-hour trading session, in tandem with Dogecoin DOGE/USD.
The consolidation, in both Shiba Inu’s and Dogecoin’s case was taking place in the form of an inside bar pattern. An inside bar pattern indicates a period of consolidation and is usually followed by a continuation move in the direction of the trend.
An inside bar pattern has more validity on larger time frames (4-hour chart or larger). The pattern has a minimum of two candlesticks and consists of a mother bar (the first candlestick in the pattern) followed by one or more subsequent candles. The subsequent candle(s) must be completely inside the range of the mother bar and each is called an “inside bar.”
A double, or triple inside bar can be more powerful than a single inside bar. After the break of an inside bar pattern, traders want to watch for high volume for confirmation the pattern was recognized.
Bullish traders will want to search for inside bar patterns on stocks or cryptos that are in an uptrend. Some traders may take a position during the inside bar prior to the break, while other aggressive traders will take a position after the break of the pattern.
For bearish traders, finding an inside bar pattern on a stock or crypto that’s in a downtrend will be key. Like bullish traders, bears have two options of where to take a position to play the break of the pattern. For bearish traders, the pattern is invalidated if the stock rises above the highest range of the mother candle.
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The Shiba Inu Chart: Shiba Inu’s inside bar leans bearish because the stock was trading lower before forming the pattern. If Shiba Inu breaks bearishly from the mother bar later on Thursday or on Friday, bullish traders will want to see the crypto print a bullish reversal candlestick above $0.00000964 to form a higher low, which would confirm a new uptrend.
- If Shiba Inu climbs higher over the next few days, Wednesday’s low-of-day at $0.00001017 will mark the higher low, which would also confirm a new uptrend. If that happens, bullish traders will want to see the crypto spike up over $0.00001184 to form another higher high.
- If that happens, Shiba Inu will regain the 200-day simple moving average as support, which would suggest the crypto is in a bull cycle. If Shiba Inu rejects from the 200-day SMA and trades lower afterward, the possible uptrend will be negated with a lower high.
- Shiba Inu has resistance above at $0.00001081 and $0.00001259 and support below at $0.00000975 and $0.00000877.
Read Next: If You Invested $100 In Shiba Inu When The Coin Launched, Here’s How Much You’d Have Now
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