Shiba Inu (SHIB) Might Add Another Zero If This Support Is Broken

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Shiba Inu, which has landed on a crucial support level, might see a strong retrace in the short term. As of right now, the token is trading slightly above the daily chart's 100 EMA, a key technical indicator that has served as support in recent weeks.

Shiba Inu, however, may experience additional downward movement, bringing the price down to a much lower threshold if this crucial support level is breached. The 50 EMA is the next significant level below the 100 EMA, although it is frequently not regarded as a strong support level in bearish trends. 

SHIB/USDT Chart by TradingView

It often functions better as a stopgap measure than a significant price floor. If the 100 EMA is broken, there could be a quick move toward the 50 EMA, given the state of the market and SHIB's technical configuration. 

For holders of SHIB, this scenario is especially concerning because a breach of the 50 EMA and the 100 EMA could lead to a more substantial price decline, possibly bringing the price below the psychologically significant $0.00001 level.

In the near run, recovery would be much more difficult if SHIB were to add another zero to its price, as this would encourage more bearish sentiment. Relatively high trading volume for the token during the most recent decline is also noteworthy, as this may point to growing bearish momentum.

Although there was a noticeable spike in whale activity earlier with SHIB, the state of the market now indicates that profit-taking might be the cause of this volume increase, also increasing the likelihood of a price drop.