Shiba Inu (SHIB) Drops Despite Golden Cross Formation

Despite the recent emergence of a traditionally bullish technical indicator, Shiba Inu (SHIB) is facing a new wave of pressure.

Shiba Inu (CRYPTO: SHIB) is facing a new wave of selling pressure despite the recent formation of a traditionally bullish technical indicator.

The token has decreased in recent sessions even though a golden cross — a pattern often linked to a continuation of upward momentum — emerged on the daily chart. A golden cross occurs when a short-term moving average crosses above a longer-term moving average. In SHIB’s case, the 23-day moving average has crossed above the 200-day moving average, which can indicate the potential for a bullish trend reversal.

However, so far, the price action has not unfolded as expected.

SHIB is currently trading at around $0.00001296, down over 5% in recent sessions. The drop in price follows a small rally that saw the token rise to highs of around $0.000014 before hitting a point of resistance and pulling back.

SHIB has struggled to sustain gains above the crossover zone, which has led traders to worry that the golden cross might be sending a false signal due to the overall uncertainty in the market.

Technical support is now located at around $0.00001274, which aligns with the 23-day moving average. A break below this level could invite more selling, with the next support level at around $0.00001107. The price is still holding above the lows of around $0.00001360.

Overall, the meme coin market continues to be a bit unpredictable, with market participants focusing on trading volume, trend confirmation and the total risk appetite across digital assets.

While golden crosses are usually a positive sign for the market, they might hold less weight when there is a lot of uncertainty among investors or when there are many short-term trades.