- Shiba Inu technical indicators and on-chain data hint at a potential breakout soon.
- Positive funding rates throughout July suggest more traders are betting long on SHIB.
- SHIB remains under its 20- and 50-month MAs, which must be reclaimed for a complete trend shift.
The SHIB token has been carving an interesting pattern on the weekly chart, trading in a long-term falling wedge formation, which is a bullish formation that signals trend reversals. This trend has defined the price movement of SHIB since its local high of about $0.00004567, which is characterized by a declining resistance line and an equally sloping support line.
Most conspicuous is the fact that the token has bounced back multiple times off a key support level between 0.0000123 and 0.00001094, which has proven to be an effective defensive barrier against subsequent losses. At press time, SHIB is rallying off this support, trading at approximately $0.00001355, roughly 12% above the recent lows.
The timing is strong: as the wedge’s apex approaches and more rumors of a coming altcoin season spread, analysts are awaiting the possibility of a breakout. A decisive breakout above the wedge’s upper trendline would trigger the token’s bullish force, and attention would shift to the key Fib retracement levels.
This action may trigger a cascade effect, with the initial bullish aim at the 50% retracement point of $0.00002785, a 106% gain from the current rates. Beyond that, the second target stands at $0.00004567, the former 2024 high and a 233% leap if reached.
Should this bullish wave continue, SHIB could extend its rally into more aggressive zones: $0.00005536 (127.2% Fib), $0.00006042 (141.4% Fib), and potentially $0.00006769 (161.8% Fib)—all strong indicators of continued upward momentum.
However, this bullish formation is dependent on a single major condition: maintaining the price support zone between $0.0000123 and $0.00001094. A decline below this level would discredit the entire wedge theory and expose SHIB to a new round of bearish momentum.
SHIB On-Chain Metrics Signal Strength Beneath the Surface
The on-chain indicators are no exception, as they also reflect Shiba Inu’s recent technical recovery, adding to the increased optimism surrounding the token and its potential upside. The most indicative indicator comes from SHIB’s decreased exchange reserves.
Since the middle of 2021, the amount of reserves in all exchanges has dropped to less than 84.4 trillion tokens by July 2025, compared to more than 225 trillion tokens. This steady outflow indicates a lower risk of imminent selling pressure, and more tokens are leaving exchanges, which is usually an indicator that long-term holders are locking in.
A clear shift in wallet dynamics supports this narrative. Over the past 30 days, holdings by long-term “Investor” addresses jumped by 3.39%, while whale holdings also ticked up 0.42%. At the same time, retail participation slid by 1.33%.
This is a slight rotation, implying that smaller holders are selling off, as experienced investors and whales are slowly accumulating, which is generally a sign of quiet confidence preceding a bigger move. The mood is also reflected in the derivatives market.
According to the Coinglass data, SHIB’s open interest (OI)-weighted funding rate has remained positive since the beginning of July, a sign of a bias towards long positions. This frequently implies that traders are willing to pay a premium to maintain their trades, which is an indication of growing confidence in a price rise.
Related: Shiba Inu’s (SHIB) 41,016% Burn Surge and AI Whitepaper: What’s Next for SHIB?
SHIB at a Turning Point as Indicators Show Mixed Signals
Despite the early technical and on-chain bullish signs, momentum indicators indicate that the token is still navigating a delicate turning point. The MACD indicator shows that despite the signal line at -0.00000009 being above the MACD line, the declining red histogram at -0.00000060 shows bearish momentum is weakening. If the trend persists, this may open the gates to a bullish crossover.
The RSI at 48.92 indicates an upward trend, reflecting a mild return of buying interest after months of retreat. Although it is not a confirmatory breakout signal, it is an indication of a change in sentiment.
Conversely, Bollinger Bands have presented tightening volatility, with SHIB in the lower section of the bands. This contraction is usually followed by steep price action. A breakout above the midline may indicate bullish action, but it remains unclear until then.
In the broader scope, the token is still trading below its 20-month ($0.00001686) and 50-month ($0.00001590) moving averages, which are major resistance levels holding price gains in check. Taking back these levels would be critical in turning the long-term trend from neutral-bearish to bullish.
Conclusion
In general, Shiba Inu (SHIB) is in a critical situation, and all technical patterns, on-chain activity, and market sentiment imply a potential trend change. Despite positive bullish signs starting to emerge- including a decrease in exchange reserves and a decline in bearish movement- resistance levels and broader market dynamics are yet to allow significant short-term gains.
Traders and investors are eager to obtain confirmation, particularly a breakout beyond key moving averages and trendlines. Meanwhile, SHIB is waiting in a state of uncertain consolidation, with the footing being prepared in the backdrop of what could be its next big move.
