DOGE and SHIB Face Early Pressure with FTX and Contagion Risk in Focus

Key Insights:

• Dogecoin (DOGE) and shiba inu coin (SHIB) found temporary relief on Thursday, with DOGE recouping Wednesday’s stumble.
• FTX bailout hopes provided early support, with the US CPI report for October delivering an early afternoon breakout.
• However, the technical indicators remain bearish, with the EMAs signaling further losses.

On Thursday, dogecoin (DOGE) jumped by 20.44%. Reversing a 16.35% slide from Wednesday, DOGE ended the day at $0.08889. Notably, DOGE ended the day at sub-$0.10 for the third consecutive session while ending a five-day losing streak.

A mixed start to the day saw DOGE fall to an early low of $0.07283. Steering clear of the First Major Support Level (S1) at $0.0653, DOGE rallied to a late high of $0.09303. DOGE broke through the First Major Resistance Level (R1) to end the day at $0.08889.

Shiba inu coin (SHIB) rallied by 10.84% on Thursday. Partially reversing a 16.44% slump from Wednesday, SHIB ended the day at $0.00000941. SHIB ended a five-day losing streak but wrapped up the day at sub-$0.000010 for a second session.

A choppy start to the day saw SHIB fall to an early low of $0.00000764. SHIB fell through the First Major Support Level (S1) at $0.00000775 before rallying to a late high of $0.000010. SHIB briefly broke through the First Major Resistance Level (R1) at $0.00000975 before ending the day at $0.00000941.

Twitter (TWTR) and Elon Musk continued to take a backseat, with investors monitoring FTX news updates throughout the session. News of Tron’s Justin Sun working on a bailout plan provided relief throughout the day. FTT rallied by 54.44% on hopes of a bailout.

Adding to the upside for DOGE and SHIB was the US CPI report for October, which fueled bets of a Fed pivot in December.

However, downside risks remain for DOGE and SHIB. Failed progress toward an FTX bailout, contagion, and regulatory action could hit the pair and the broader crypto market.

This morning, news of CFTC, SEC, and Department of Justice investigations into FTX sounded the alarm bells. Following the Terra collapse, investigations could uncover more dirty laundry to hit investor confidence.

Overnight, BlockFi announced the freezing of withdrawals citing the FTX collapse, raising contagion fear. Investors will have to monitor the news wires for FTX updates and contagion news.

Dogecoin (DOGE) Price Action

At the time of writing, DOGE was down 6.76% to $0.08288. A mixed morning saw DOGE rise to an early high of $0.08955 before falling to a low of $0.08068.

Technical Indicators

DOGE needs to move through the $0.0849 pivot to target the First Major Resistance Level (R1) at $0.0970. A move through the Thursday high of $0.09303 would signal a possible breakout. However, FTX updates need to be crypto-friendly to support a return to $0.09.

In the event of an extended afternoon breakout session, the bulls could take a run at the Second Major Resistance Level (R2) at $0.1051. The Third Major Resistance Level (R3) sits at $0.1253.

Failure to move through the pivot ($0.0849) would leave the First Major Support Level (S1) at $0.0768 in play. However, barring another extended sell-off, DOGE should avoid sub-$0.0650 and the Second Major Support Level (S2) at $0.0647.

The Third Major Support Level (S3) sits at $0.0445.

The EMAs sent a bearish signal, with DOGE sitting below the 200-day EMA, currently at $0.09021. The 50-day EMA converged on the 100-day EMA, with the 100-day EMA narrowing to the 200-day EMA. The price signals were bearish.

A bearish cross of the 50-day EMA through the 100-day EMA would support a fall through S1 ($0.0768) to test support at $0.0700. However, a DOGE move through the 200-day EMA ($0.09021) would give the bulls a run at R1 ($0.0970), the 100-day ($0.10002), and the 50-day ($0.10088) EMAs.

Shiba Inu Coin (SHIB) Price Action

At the time of writing, SHIB was down 3.40% to $0.00000909. A mixed start to the day saw SHIB rise to an early high of $0.00000984 before sliding to a low of $0.00000881.

Technical Indicators

SHIB needs to avoid the $0.00000911 pivot to target the First Major Resistance Level (R1) at $0.00001039. A move through the Thursday high of $0.000010 would signal a bullish afternoon session.

In case of an extended rally, SHIB would likely test the Second Major Resistance Level (R2) at $0.00001138. The Third Major Resistance Level (R3) sits at $0.00001374.

A fall through the pivot would bring the First Major Support Level (S1) at $0.00000803 into play. Barring another extended sell-off, SHIB should avoid sub-$0.00000700 and the Second Major Support Level (S2) at $0.00000666.

The Third Major Support Level (S3) sits at $0.00000430.

The EMAs send a bearish signal, with SHIB sitting below the 50-day EMA, currently at $0.00001059. This morning, the 50-day EMA pulled back from the 100-day EMA, with the 100-day EMA easing back from the 200-day EMA. The signals were bearish.

A move through R1 ($0.00001039) and the 50-day EMA ($0.00001059) would support a breakout from the 100-day ($0.00001099) and the 200-day ($0.00001108) EMAs to bring R2 ($0.00001138) into play.