Shiba Inu (SHIB) appears to be facing several bearish factors that could push its price down to a new annual low. The token, which was a standout in 2021, has come under significant pressure this year. How should traders approach this possible decline? Details follow, but first some highlights.
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SHIB has traded below its 55- and 200-day simple moving averages (SMAs) in recent weeks.
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The token is highly sensitive to geopolitical headwinds in Europe.
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At the time of writing, SHIB traded at $0.00002173, down about 3% on the day.
Data source: TradingView
Shiba Inu (SHIB) – How to trade this downtrend?
The bearish tone around Shiba Inu is unsurprising. When the broader market weakens, meme tokens like SHIB typically suffer the most. Investors generally avoid speculative assets when overall market risk rises.
SHIB trading below its 55- and 200-day SMAs signals a bearish regime. The token could slide toward primary support near $0.00001704 before finding meaningful buying interest. That move would represent roughly a 25% decline and could place SHIB at its lowest levels since 2022.
Ongoing geopolitical pressure emanating from Europe could add to downside risk. A practical approach could be to short SHIB on short-term rallies and consider going long after a confirmed bottom forms near $0.00001704.
Has Shiba Inu (SHIB) lost momentum?
After its breakout in 2021, there are concerns that Shiba Inu may have lost momentum. Meme tokens often fade quickly after dramatic runs. Still, SHIB remains a large and well-known project, and it is unlikely to disappear overnight.
Following the record highs of 2021, it was expected that 2022 would challenge the token’s ability to sustain that level of interest. Despite those challenges, SHIB continues to rank among the most notable meme coins for investors keeping exposure to this market segment.