The surge in the price of Shiba Inu (SHIB) so far in October pushed the SHIB token to become the second largest digital asset by market capitalization.
Shiba Inu’s market capitalization jumped to $11.08 billion earlier this week and currently exceeds $10 billion, placing it in the top 20 by market capitalization for the first time. As a result, the Dogecoin-inspired meme cryptocurrency has become more valuable than popular blockchain projects such as Stellar (XLM), Polygon (MATIC), and Tron (TRX).
The growth in Shiba Inu’s rating followed a tweet by Elon Musk. On October 4, the Tesla CEO posted a photo of his pet dog – a Shiba Inu breed – with the caption “Floki Frunkpuppy”. SHIB stock jumped more than 40% an hour after the tweet.
Floki Frankpuppy pic.twitter.com/xAr8T0Jfdf
– Elon Musk October 4, 2021
Cryptocurrency speculators tend to read a lot in Musk’s tweets. For example, the billionaire businessman was instrumental in driving the price of Dogecoin (DOGE) higher earlier in 2021 via Twitter.
SHIB is up about 400% weekly after opening Q4 2021 at $0.0000725. In doing so, the coin retested its five-month high at $0.00003528 on October 7.
However, SHIB underwent a 40% surplus price correction on the same date as some traders decided to cancel their spot positions for temporary profits. As a result, Shiba Inu’s market capitalization fell side by side, reaching $8.06 billion on Friday.
Selling in Shiba Inu markets (against the Dollar and Bitcoin) stimulated buying sentiment on the pullback. A rebound rally followed, pushing SHIB price up more than 45%. At its highest levels on Saturday, the token was trading at $0.0003020, with a market capitalization of around $10.73 billion.
What’s next for SHIB?
On October 9, Shiba Inu price fell more than 5% to reach an intraday low of $0.00002575. In doing so, the cryptocurrency hinted at the formation of a possible descending triangle pattern, which indicates additional losses ahead.
Related: ‘A lot’ to come? Dogecoin fractal chart shows Shiba Inu up 390% in Q3 at risk
In detail, descending triangles are typically bearish patterns that form when price trends are declining while oscillating between an area defined by two converging trend lines: one descending and the other, horizontal, like the one formed by SHIB in the chart below.
The formation of lower tops above a dead-end support line indicates weak buying sentiment among traders. As a result, the price eventually tends to break below the horizontal trend line. In doing so, its target moves to a plane with a length equal to the maximum height of the triangle.
In other words, SHIB price may drop below $0.000001,000 in the upcoming sessions if the aforementioned support level fails to hold.
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