Binance Coin Technical Analysis: BNB breakdown imminent despite positive on-chain activity


  • Binance Coin is sitting on the edge of a cliff; a little wriggling could see it tumble to $22.
  • BNB positive on-chain activity on full throttle led by the daily active addresses.

Binance Coin made a shallow recovery from losses posted towards the end of September. Support embraced at $22 resulted in an upswing. Bulls regained control of the price to the extent, BNB/USD tested the hurdle at $30. However, a reversal came into the picture, leaving September highs around $34 untested. In the meantime, Binance Coin is teetering at $27.4 as bears stamp their feet down.

Binance Coin impending breakdown could revisit $22

Selling activities are lingering within the Binance Coin markets. The Relative Strength Index (RSI) is also on a downtrend. If the RSI slides under the midline and continues with the downward movement towards the oversold area, the possibility of selling orders surging will rise.

BNB’s lower leg is also on the verge of slicing through the 50 Simple Moving Average (SMA) in the 12-hour timeframe. Declines under this critical moving average could kick start a breakdown to the support at $22. The 100 SMA in the 12-hour timeframe is in line to absorb some of the selling pressure around $25.

BNB/USD 12-hour chart

BNB/USD price chart

The bearish case is also highlighted by the ascending triangle pattern, formed by price actions that allow a horizontal line to be drawn above the swing highs while a rising trendline connects the swing lows. Traders lookout for breakouts, especially the ones that occur below the ascending trendline. In this case, BNB is likely to resume the downtrend, revisiting the $22 and $20 levels.

According to Santiment, BNB is showing bullish signs based on various on-chain metrics. The on-chain analytics platform highlights “a 40-day high in unique addresses transacting on its network.”

The holder distribution metric by Santiment also shows an increase in the whale’s activity. Addresses holding between 10,000 and 100,000 BNB have increased from 43 on October 4 to 45 on October 7. As these addresses grow, buying pressure is likely to rise. A surge in the buying pressure could continue with the rally back to $30.

BNB holder distribution chart

BNB holder distribution

Simultaneously, an increase in daily active addresses over the last few days suggests that on-chain activity is booming within the network. At the time of writing, the addresses stand at 6,334, up from 4,722 on October 5. Further increase in the daily active addresses is likely to support a bullish narrative.

BNB daily active addresses chart

BNB daily active addresses

Looking at the other side of the picture

Binance Coin is giving mixed signals according to the above analysis. On-chain activity suggests a possible breakout. On the other hand, technical analysis hints towards an imminent breakdown. If the 50 SMA remains intact as the short-term support, buyers are likely to regain control based on the positive on-chain activity support.


Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.

If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.

FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.

The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.

Recommended content


Recommended Content

Editors’ Picks

Top 3 Price Prediction Bitcoin, Ethereum, Ripple: BTC declines as resistance emerges near all-time high

Top 3 Price Prediction Bitcoin, Ethereum, Ripple: BTC declines as resistance emerges near all-time high

Bitcoin and Ethereum are approaching their key support levels, and a sustained close below these marks could lead to further declines. 

More Cryptocurrencies News
TON set to launch synthetic Bitcoin to boost its DeFi solutions

TON set to launch synthetic Bitcoin to boost its DeFi solutions

TON revealed its plan on Thursday to launch a synthetic Bitcoin token on its blockchain, allowing users to trade, stake, and earn yield using BTC. Following the announcement, TON is down over 3%.

More Ton News
Maker Price Forecast: MKR could stage 40% rally

Maker Price Forecast: MKR could stage 40% rally

MakerDAO is up 2% on Thursday and could be set for a 40% rise in the coming weeks if it successfully maintains an extended move above the descending trendline of a falling wedge. On-chain data also supports the bullish outlook after a four-month-long decline.

More MakerDAO News
USDT market cap crosses $120 billion as stablecoins continue their uptrend

USDT market cap crosses $120 billion as stablecoins continue their uptrend

The stablecoin market cap continued its uptrend in October, characterized by USDT reaching a $120 billion market cap, according to a CCData report on Thursday. This indicates that investors are preparing liquidity to fuel more demand.

More USDT News
Bitcoin: New all-time high at $78,900 looks feasible

Bitcoin: New all-time high at $78,900 looks feasible

Bitcoin price declines over 2% this week, but the bounce from a key technical level on the weekly chart signals chances of hitting a new all-time high in the short term. US spot Bitcoin ETFs posted $596 million in inflows until Thursday despite the increased profit-taking activity.

Read full analysis
Best Forex Brokers with Low Spreads

Best Forex Brokers with Low Spreads

VERIFIED Low spreads are crucial for reducing trading costs. Explore top Forex brokers offering competitive spreads and high leverage. Compare options for EUR/USD, GBP/USD, USD/JPY, and Gold.

Read More

BTC

ETH

XRP