An analysis said Shiba Inu could see its market capitalisation expand sharply if it breaks a multi-year descending resistance line.

On May 21 local time, blockchain media outlet The Crypto Basic reported that market analyst Don said Shiba Inu could enter a bull market if its long-term downtrend line breaks.

Shiba Inu’s market capitalisation is currently $3.43 billion, ranking 29th among cryptocurrencies by market cap. After posting a market cap of $19.7 billion in December 2024, Shiba Inu has been capped by a downtrend line. It has since fallen 82.5 percent to the current level.

Price action was similar. Shiba Inu’s price fell by the same rate, from $0.00003343 in December 2024 to $0.00000582 now. With circulating supply barely changing, the drop in market cap has coincided with price weakness.

The analysis focuses not only on the decline but also on a potential breakout zone. Assets that move sideways for a long time below resistance can make a large move in one direction, and Don said Shiba Inu meets the same conditions. He argued that if Shiba Inu breaks the years-long descending resistance line, it would enter an “explosive rally.”

The first level for the market to confirm was put at a market cap of $3.74 billion. This level touches the end of the diagonal resistance line. It requires an additional $310 million from the current market cap and corresponds to a price of $0.00000634.

Targets after a break above resistance were also presented. The first target is a market cap of $8.54 billion. Based on a circulating supply of 589.24 trillion tokens, that implies a price of about $0.0000145.

A final target of a $20 billion market cap was mentioned. In that case, the price would be $0.0000339, slightly above the December 2024 high. Reaching that level from the current price would require a 483 percent rise.

Still, near-term market sentiment remains cautious. In derivatives markets, open interest fell 3 percent over the past 24 hours to $49.8 million, suggesting derivatives trading activity is slowing.

Spot flows were also cited as a burden. Over the past 24 hours, net spot inflows to exchanges totalled 15.47 billion SHIB. An increase in exchange inflows is typically interpreted as raising the possibility of more supply waiting to be sold. In this situation, whether Shiba Inu can reclaim the market-cap resistance zone around $3.74 billion is emerging as the first key point to watch for a short-term rebound.

The core of the analysis is that it assessed Shiba Inu’s rebound potential not by price action alone but by a long-term market-cap resistance line. With declining open interest and rising net spot inflows also confirmed, it expects whether there is an actual trend reversal will depend not only on reclaiming resistance but also on whether supply-demand conditions improve.

once $SHIB breaks out from the diagonal resistance line, it would be full send mode. pic.twitter.com/Qq0xmTOKGz