Shiba Inu's Overbought Warning: Can It Sustain its Recent Gains?

Shiba Inu's recent price surge has placed it in a precarious position according to technical analysis. The cryptocurrency's daily RSI (Relative Strength Index) reading of 77.27 is well above the overbought threshold, indicating that the easy upside has likely been captured.

The hourly chart, on the other hand, shows an RSI of 58.19, which is comfortably in positive territory without approaching overbought levels. This suggests that the short-term trend structure remains intact and buyers are still active on lower timeframes.

However, the Fear & Greed Index at 26 indicates deep market caution despite prices having climbed. In this environment, the pool of fresh buyers willing to pay elevated prices for speculative assets like Shiba Inu tends to thin out quickly, making it harder for overbought rallies to sustain themselves without a correction.

The collapse of DEX (Decentralized Exchange) volumes across the board is also a concerning sign. Uniswap V3 fees are down 57.76% in a day, Fluid DEX down 86.27%, and Curve DEX down 72.32%, according to DefiLlama data.