The memecoin Shiba Inu ($SHIB ) has gained over 78.5% year-to-date, reaching $0.0000191 as of November 8. While it has underperformed compared to other top memecoins such as Dogecoin ($DOGE ) and Pepe ($PEPE ), which are up over 115% and 668%, respectively, recent technical and fractal indicators suggest that SHIB may be on the verge of a significant rally. Here are three key indicators pointing to SHIB’s potential for substantial gains.
1. Bullish Cup-and-Handle Pattern
A key technical indicator for SHIB’s potential rally is the ongoing formation of a "cup and handle" pattern on the daily chart. This classic bullish setup, named for its resemblance to a teacup followed by a smaller, downward-trending handle, is generally regarded as a precursor to an upward breakout.
As of early November, SHIB is in the "handle" phase of this pattern, approaching a neckline resistance level at approximately $0.00002032. Should SHIB break above this resistance, the target for the breakout could push SHIB up to around $0.00003545, representing a 90% increase from current levels. Notably, this target aligns with SHIB’s resistance area from March 2024, which includes a peak around $0.00004567.
2. Potential Capital Rotation from Dogecoin
SHIB has trailed DOGE this year, partly due to the ongoing spotlight on Dogecoin from public figures like Elon Musk. However, signs of a potential capital rotation from DOGE to SHIB are emerging, driven by differences in their respective momentum indicators.
As of November 8, DOGE's daily Relative Strength Index (RSI) was above 70, a level commonly considered “overbought” and indicative of a potential pullback. By contrast, SHIB’s daily RSI was at a more neutral 58.42, suggesting greater room for upward movement.
This trend is also visible in the SHIB/DOGE trading pair, where the daily RSI indicates oversold conditions, suggesting that selling pressure on SHIB compared to DOGE may be nearing exhaustion. If DOGE investors start to take profits, it could result in a capital rotation that supports SHIB’s price, further fueling its upward potential.
Historically, similar technical conditions in SHIB have led to rallies ranging from 30% to 150%. With SHIB currently showing an oversold RSI in a key support area, it appears primed for a potential recovery against DOGE. In this scenario, an initial upside target for SHIB/DOGE would be near the 50-day Exponential Moving Average (EMA), around 0.0001276 DOGE, implying a gain of over 30%.
3. Strategic Developments and Political Tailwinds
The Shiba Inu ecosystem has proposed a Strategic Hub for Innovation and Blockchain (S.H.I.B.) to be established in a U.S. city, aiming to position it as a global center for blockchain and sustainable development. This initiative would foster blockchain innovation, likely leading to new use cases and applications for SHIB that could strengthen its appeal among investors.
Additionally, a potential second term for former U.S. President Donald Trump could bring policies favorable to economic growth, deregulation, and public-private partnerships, factors that may benefit blockchain projects like S.H.I.B. These policy shifts could boost investor confidence in SHIB as its ecosystem expands through innovative and government-aligned projects.
Conclusion
While SHIB has underperformed its peers so far, multiple technical and strategic indicators suggest it may soon gain momentum. The presence of a bullish cup-and-handle pattern, signs of potential capital rotation from DOGE, and strategic initiatives aligned with a supportive political climate all point to SHIB as a potential “sleeping giant” in the current bull market. If these factors align, SHIB could experience a substantial price surge of up to 90% as early as 2025.
