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.

Cryptos feed

Latest Crypto News

Latest Crypto News & Analysis

Editors’ Picks

Top 3 Price Prediction Bitcoin, Ethereum, Ripple: Bloodbath in the crypto markets as investors realize profits

The cryptocurrency market has painted red on Thursday during the European session as traders and investors have started taking profits. As discussed earlier in the day, a correction was around the corner, mainly due to the cryptocurrency fear and greed index at a record high.

More Cryptocurrencies News

Cardano Price Prediction: ADA must overcome a massive supply barrier to extend a recovery

Cardano (ADA) has climbed to the 8th position in the global cryptocurrency market rating. The coin hit $0.194, the highest level since July 2020, on November 24, before the correction started.

More Cardano News

Greed among cryptocurrency investors soars to the highest level ever recorded

The cryptocurrency market has been on a consistent and remarkable rally since the beginning of November. Most crypto assets are trading at levels not seen since 2017 and early 2018.

More Cryptocurrencies News

Bitcoin price shows four signs of a market top that may lead to a correction towards $13,000

Downside corrections are not something to be fearful of. They are an essential part of a bullish trend, and a sell-off always comes after a strong rally, just like the dusk always comes after the dawn.

More Bitcoin News


Bitcoin Weekly Forecast: BTC makes new yearly highs while its network activity looks worrisome

Bitcoin has lived through the best week since February 2018. The pioneer digital currency price gained over $2,000 in less than seven days. The bullish momentum allowed it to reach a new multi-year high of nearly $18,800, marking November 2020 one of the strongest bullish months ever. 

Read the weekly forecast