Are we about to witness a bullish rally or a bearish stronghold in the BNB market? This is the question that this BNB market analysis aims to answer. Over the past few weeks, Binance Coin (BNB) has been locked in a sideways movement on lower timeframes, hinting at the possibility of a short-term price surge.
BNB’s Sideways Market Structure
Despite the bearish market structure that has dominated BNB’s trading, bullish attempts to reverse the sustained price dip have been largely unsuccessful. The price has bounced back from the $205 support level, but the bulls haven’t managed to break through the resistance level between $220-$225. This impasse has resulted in BNB trading sideways for over three weeks, following the last price rejection at the resistance level on 31 August.
Indicators of Market Momentum
The Relative Strength Index (RSI) offers insight into the oscillating momentum currently experienced by BNB. On the 12-hour chart, the indicator has been regularly flipping between buying and selling pressure, with BNB trading at a compact price level. As bulls and bears maintain their respective support ($205) and resistance ($220-$225) levels, BNB may continue to exhibit ranging price action in the short term.
Potential Scenarios for BNB
Based on the muted movement of the On Balance Volume’s (OBV), two scenarios could unfold in the coming days. In the first scenario, bulls might catch short sellers off guard with a break above $220, potentially pushing further to $240. Alternatively, another bearish rejection could prompt sellers to retest the $205 support level for the third time, possibly breaking down to the $188 support level on a weekly timeframe.
Open Interest data from Coinalyze reveals a lackluster interest in new futures positions over the past day, coinciding with a minor price bump for BNB from $215 to $217. This suggests that speculators might be waiting for a price break above a critical level before pushing for more gains. Likewise, the rising spot CVD since 16 September has encouraged buyers, reflecting a return of bullish bias to BNB with a good tendency for decent buying gains in the short term.
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