Shiba Inu (SHIB), the second-largest meme coin by market cap, is nearing its first golden cross since December 2023, which could signal potential price movements. A golden cross occurs when the 50-day moving average crosses above the 200-day moving average, historically indicating a bullish trend. The last time SHIB experienced a golden cross, its price surged nearly 148%, showcasing the possibility of a strong upward trend following this pattern.
Despite this promising technical indicator, the price of SHIB remains highly volatile. Recently, the token saw a price surge of 57% after a breakout, only to fall by 27% in subsequent days. This unpredictability is common with meme coins, especially those driven by market sentiment, as is the case with SHIB. Therefore, while the golden cross might indicate positive momentum, caution is advised for investors.
Past golden crosses have led to mixed results. While some were followed by significant gains, others quickly reversed into a "death cross," where the 50-day moving average falls below the 200-day moving average, signaling a potential downtrend. Investors in SHIB should consider both the historical data and the inherent volatility of meme coins before making any decisions.