- BNB price continues to reel after breaking critical support levels.
- Bulls attempt to recover most of Monday’s losses.
- Upside potential is now extremely high as volume pours in.
BNB price followed the broader cryptocurrency and risk-on markets to a major route yesterday. Binance Coin experienced a major collapse, falling more than 17%. However, buys have returned, and volume is increasing - giving bulls hope that a change in direction may occur soon.
BNB price is poised to reverse but could be limited to the $375 value area.
BNB price is in a dangerous zone for bulls on its weekly chart. Currently, Binance Coin price and the Chikou Span are below the Ichimoku Cloud. If the weekly chart closes at or below $361, it would close below the cloud and confirm an Ideal Bearish Ichimoku Breakout - a major warning that an extended downtrend will continue.
BNB/USDT Weekly Ichimoku Kinko Hyo Chart
However, if BNB price does close near $361, that would print a very powerful bullish reversal candlestick - powerful enough that it may negate any further downside pressure. Moreover, today's bounce certainly hints that a new upswing may occur.
A theoretical long opportunity exists for BNB price with a buy stop on the three-box reversal from the current O-column (currently at $335), a three-box stop loss, and a profit target at $380. If the current O-column moves lower, the entry and stop-loss follow in tandem, but the profit target remains the same.
The long setup represents, at present, a 3:1 reward for the risk. The projected profit target at $380 is likely to be limited near the $375 value area where the weekly Tenkan-Sen and bottom of the weekly Ichimoku Cloud (Senkou Span B) currently exist.
The theoretical buy setup is invalidated if BNB price drops below $285 before the buy stop would be triggered.