Are Shiba Inu & Dogecoin Losing Their Bite?
Shiba Inu has often been dubbed as the Dogecoin killer. On the other hand, Dogecoin currently has a stronger following. The situation is uncertain and one or the other cryptocurrency may not survive the return of risk-on behavior to the crypto market. Or are they both fighting a losing battle?
The global crypto market cap is currently $1 trillion, causing the value of digital currencies to decline by almost 3 to $918 billion. However, the volume of the crypto market has increased significantly by about 35% within the past 24 hours, based on the data collected.
To maintain inflation rates, central bankers have been forced to increase interest rates, causing global markets to tank. Cryptocurrencies have begun declining at a faster rate recently because of outside events, like payrolls and statements made by monetary authorities. As such, these assets are affected more than others when global risk is present, making them decline at a faster pace.
It’s been a rough year for cryptocurrencies, losing almost $2 trillion in value from their last year peak. As crypto winter sets in, coin prices have seen sharp dips of nearly 50%.
Dogecoin Pattern and the Price Movement
Ever since Musk first attempted to buy his way onto the board of Twitter by eventually acquiring the communication company a couple of weeks ago, Dogecoin has been on a volatile journey. DOGE has been treading water for over two years now, and if Twitter doesn’t start accepting the currency soon, that isn’t likely to change. So far, Elon Musk is the only one keeping investors hopeful.
Given Elon Musk’s recent business moves, DOGE investors are probably waiting for confirmation Dogecoin can be used as a payment method on Twitter. As of yet, Musk has not said whether Dogecoin will be able to be used as payment for Twitter account confirmation.
After Dogecoin’s rebound from the $0.06 support level on October 25th, bulls had a chance to make exponential gains on the charts. This resulted in the meme coin jumping above the daily moving average of 20/50/200, exhibiting a strong bullish edge.
The recent bull run continued unabated, with buyers able to flip the $0.111-mark from opposition to support after an astonishing 140% ROI in the final week of October. In the meantime, though, the $0.14 ceiling has put a stop to the green candlesticks streak.
Furthermore, the recent price movements have created a bullish pennant in recent weeks. A potential breakout above this pattern could lead to positioning the coin for upside movement.
If DOGE remains above the pattern, it could reveal an upside move toward the $0.17 region in the near future. If it breaks above the expected $0.14 ceiling, it could confirm the chances of an upside.
A Chance at Success
Typically, breakouts that occur while a pennant is forming are more likely to succeed when volumes are trending upwards. In this case, the volume has been trending downward. Therefore, this suggests that an immediate pullback could find dependable rebounding ground around $0.111.
The Relative Strength Index (RSI), the momentum indicator that measures the magnitude of recent price changes to analyze overbought or oversold conditions, made a slight decline from the previous overbought mark, but still positioned itself above 70. If this index declines any further, it could signal a change in investor behavior.
With the asset’s volatility decreasing and the price movements going sideways, Dogecoin is in the midst of forming a new pattern that may develop the much-needed cooldown. Although Dogecoin’s volatility decreased recently, investors are still hopeful for a possible upturn in the near future.
Dogecoin’s Open Interest registered an uptick of over 8.5% across all exchanges in the past 24 hours. A 24-hour price increase of over 5% for DOGE confirmed the bullish edge in the futures market. In addition, the coin had an 84% 30-day correlation with Bitcoin. Consequently, crypto enthusiasts should monitor Bitcoin’s price action to make informed decisions when trading these assets.
Shiba Inu Still Stuck in the Status Quo
Shiba Inu, the cryptocurrency created as a parody of Dogecoin, is struggling to keep up with the competition in the market. Shibu Inu remained trapped on the market, without a clear path to turn to, stuck between the 200 and 50-day moving averages.
The volatility of the token demonstrates that investors are still uncertain about which direction the cryptocurrency market will turn. Given that Shiba Inu is closely associated with the stock market, it’s likely that the movement of large caps will drive up SHIB’s volatility.
As private traders leave the cryptocurrency market, Shiba Inu will become more correlated with other large coins since market makers will be the only group of people still trading it. The last rate hike was not good news for meme tokens or other risk assets like Shiba Inu, making it difficult to predict whether the trend will continue. Because meme assets are so volatile, investors are becoming weary of taking any unwarranted risks so soon after the Fed indicated that it plans to keep monetary policy restricted.
So far this year, Shiba Inu has lost not only the value of its currency but also in terms of development. The Shiba Inu team is working at a snail’s pace compared to other products, causing investors and potential buyers to be extra cautious with predicting its future.
Musk to the Rescue?
As news of Elon Musk’s acquisition of Twitter broke a couple of weeks ago, dog-themed crypto coins saw an instant increase in interest. This includes the struggling Shiba Inu. The surge saw one whale place a purchase order for 3.3 trillion Shiba Inu (SHIB), amounting to approximately $33.6 million. Will this push turn out to be only temporary remains to be seen in the upcoming months?