Shiba Inu's Price Hike Sparks Bull Trap Fears

Shiba Inu's price hike on Friday, August 14th, has raised questions about whether it's just a bull trap or not. The Open Interest on Shiba Inu positions rose by 13.4% from $46.54 million the day before to $52.79 million, according to Coinglass.

This was accompanied by an uptick of 4.03% in spot demand for Shiba Inu, which has been steady lately. However, analysts are warning that swing traders should be cautious and not get caught up in the short-term upward momentum.

The bearish swing structure of Shiba Inu on the 1-day timeframe, highlighted by a recent report from AMBCrypto, shows that the bounce in late July extended to $0.00000583 but only tested an overhead supply zone. Since then, the memecoin has fallen by 21.4% in three weeks.

The short-term upward momentum on Friday saw Shiba Inu surge into this overhead supply zone, but technical indicators on the H4 timeframe show that bears still have the upper hand. The RSI is above the neutral 50-level, but momentum is not strongly bullish, and the CMF remains below -0.05 for most of August, indicating considerable capital outflows.

Traders are advised to sell Shiba Inu on the back of a quick uptick in volume, as it could be an ideal selling opportunity. The price has swept the overhead liquidity, and there is another cluster of short liquidations just below $0.0000048 that could be targeted over the weekend before a bearish move.