On the 20th of October, 2022, Shiba Inu (SHIB) is now down another comma after losing the battle to the psychological price evaluation of $0.000010 and fell down to about $0.0000097. Since then, the price has recovered back to $0.00001001, but this could spell trouble in the near future for Shiba Inu (SHIB).
- SHIB lost support at $0.000010; This is going to be problematic.
- Price of SHIB recovered back to $0.000010, but this could be a fallacy.
- SHIB needs to go over $0.000011 to be back to safety.
The current SHIB support is $0.000010, but now that SHIB has gone below that, investors will start losing confidence in the token. However, experienced traders will instead benefit from that and buy the dip.
So now that the price of SHIB recovered, what can we expect?
What’s next for Shiba Inu (SHIB) after it’s down another comma?
Now that Shiba Inu (SHIB) is down another comma, a couple of things could happen. Since it is barely holding onto the support of $0.000010 it is going to be an extremely risky and potentially profitable investment for experienced traders. Most likely the price will now fall 15%-20%, after which many will buy in the dip, which will naturally recover the price of the asset back to its normal state.
However, there’s another possibility. If the market crashes in the upcoming days, SHIB might remain under $0.000010 for a little longer until a recovery cycle begins.
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Another option is for people to buy in the dip so hard that it bypasses the $0.000010 price point and goes back to $0.000011. Unfortunately, since the number $0.000010 looks so right (which sounds wrong but is true), SHIB will have a more difficult time bypassing this barrier.
Why are psychological barriers so dangerous?
People are attempting to construct these indicators themselves because the cryptocurrency market doesn’t have as many indications as the stock market or the price of conventional currencies in forex. Looking at a token’s price is one method of doing it.
Let’s imagine a cryptocurrency that is on the verge of reaching a price of $100. Due to the psychological threshold, many individuals will attempt to sell the token at this time. Since there are no signs of when this will end, individuals pick a price that just seems reasonable. It is preferable to sell in these circumstances right before that price threshold.
However, the other option is that the price of the token continues to expand since this rule is not set in stone. You can see examples of this in almost all cryptocurrencies back in 2021.
When the rally began, a lot of tokens went 10x and more. However, on their journey to reaching new all-time highs, tokens were getting sold at such thresholds, after which experienced traders bought in the dip and proceeded to take gradual profits. This method is known as “asset allocation”. It takes off the risk of losing everything while still taking some profit.
It is almost impossible to predict the price of cryptocurrencies precisely because of this phenomenon. However, if you analyze the market as we did, you can give approximate prices. Check out Shiba Inu’s price prediction.
Can Shiba Inu (SHIB) recover?
Now that SHIB has fallen below $0.00001, you might be wondering what incentive investors will have to purchase the drop. The Shiba Inu Army is extremely large, to begin with. SHIB has 3.5 million followers on Twitter in total. This exceeds the value of practically every other cryptocurrency available.
In addition, a large number of users are staking the token at various liquidity pools. Since this will mean the end of their possible future 10x profits, they cannot allow the token to lose value. We may anticipate supporters of SHIB to go all-in at this point. This would indicate that we would witness a rally of around double the lost percentage. Therefore, suppose SHIB increases from $0.000010 to $0.000008. There will be a 20% evaluation loss as a result.
If the token bounces back, it will require at least a 25% increase in value to bounce back. Given the popularity of Shiba Inu, this creates a profit margin of 5%, from which many will attempt to benefit from.
Overall, the highest possible outcome here is that investors and traders will not let the token they’ve invested so much in dying out. This means that the price of SHIB will remain above the support of $0.000010 until it truly recovers during the next bull cycle.
Until then, the price of Shiba Inu (SHIB) might drastically decrease below the previous low during June.
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