Shiba Inu déjà vu? 2 reasons SHIB price may rocket higher

Shiba Inu (SHIB) has been showing positive signs in the market, with its price holding steady and technical indicators pointing to potential further gains. On Wednesday, SHIB was priced at $0.000020, reflecting an 82% increase from its lowest point in August, and investors are closely watching its movements due to a combination of favorable market sentiment and technical signals.

Key Factors Behind the Rally:

1. Shift to Risk-On Sentiment: One of the main catalysts for SHIB’s recent rise is the broader shift in investor sentiment toward risk-on assets, driven by expectations of more crypto-friendly regulations under Donald Trump’s potential election victory. Investors seem optimistic that the crypto industry could benefit from a more supportive regulatory environment in the coming years.
2. Increased Token Burns: Another significant factor behind SHIB’s price momentum is the sharp increase in the token burn rate. Data from Shibburn showed that the burn rate surged by an astounding 3,674%, with 53,312 SHIB tokens burned on Nov. 6. Over 410 trillion SHIB tokens have been burned from the initial supply, reducing the circulating supply to around 583 trillion coins. Token burns are generally seen as a deflationary mechanism that helps increase the scarcity of a token, potentially boosting its value.
3. Shibarium Network Activity: While transaction volume and fees on Shibarium have been declining, there’s still activity supporting SHIB’s fundamentals. BONE tokens collected in Shibarium are being converted to SHIB and burned, which adds to the deflationary pressure.
4. Futures Open Interest and Demand: SHIB’s futures open interest rose to $51.1 million, the highest level since October 30, suggesting growing demand from traders and investors.

Technical Outlook:

1. Golden Cross Pattern: A critical technical signal to watch is the potential formation of a golden cross, which occurs when the 50-day and 200-day Exponential Moving Averages (EMA) converge and cross over each other. Historically, this pattern has been a bullish indicator for cryptocurrencies, as it signals a shift to upward momentum. Shiba Inu is nearing this pattern, which could lead to further gains if it plays out as expected.
2. Resistance and Support Levels: SHIB is currently eyeing a key resistance level at $0.000021 (its high from Sept. 27). If the price breaks above this level, it could pave the way for further upside, targeting the next resistance at $0.00002940, which represents a 54% potential gain from the current price. On the downside, a drop below the support level at $0.000015 would negate the bullish outlook, indicating potential selling pressure.

Shiba Inu is showing a lot of promise, with several bullish signals from both fundamental factors (increased token burns, risk-on sentiment, and regulatory optimism) and technical indicators (a potential golden cross and rising open interest). If SHIB can break key resistance levels, it could see significant upside, potentially reaching the $0.000029 level. However, traders will need to watch for any signs of a breakdown below key support, as this could signal a shift in momentum.