Binance Coin, the flagship cryptocurrency of Binance, the world’s largest crypto exchange, has been hit with a wave of volatility, sparking concerns about the sustainability of its price rally. After reaching historic highs multiple times in a month, the BNB price plummeted by 15% in the recent trading, leaving investors wondering if the market is due for a market correction or if the worst is yet to come.
As the crypto community grapples with the implications of this sudden drop, technical analysis and fundamental indicators provide valuable insights into the future trajectory of the token. With its all-time high of $1,370 serving as a key resistance level, the question now prevailing is: Can BNB price regain its footing, or is this the end of its upward trend?
BNB Price Dips: What’s Behind This Sudden Crash?
The Binance Coin has seen a surprising downtrend after surging to multiple record highs over the past month. It hit its latest all-time high of $1,370 on October 13, exhibiting a remarkable recovery from the greatest crypto market crash on Saturday.
While the token managed to surge to a new ATH despite the market crash, investors have been highly vocal about the altcoin. Many believed that BNB would continue its rally to hit new all-time highs in the coming months. Some even predicted its journey to an ambitious $5k before Ethereum could attain it.
However, things took an unexpected turn as the BNB token price plummeted to a low of $1,033 from a daily high of $1,190. At press time, the token is valued at $1,073, marking a significant decline of 10% in a day. Despite a 12% monthly hike, the token has seen a notable downtick of 15% over the past week.
Despite the recent price drop, the crypto’s 24-hour trading volume is in green, indicating a surge in market activity. This divergence between price and volume suggests that investors are accumulating or repositioning, potentially viewing the dip as a buying opportunity. The increasing volume could also signal a buildup of momentum, setting the stage for a potential reversal or stabilisation in price. As traders and investors continue to engage with BNB, the rising volume may hint at a more nuanced market narrative beneath the surface-level price decline.
Notably, this plummet is part of the broader market crash, where the total market capitalisation has reached $3.58 trillion, down 5.6%. This decline was mirrored in major tokens including Bitcoin, Ethereum, XRP, and Solana, all of which saw significant losses.
Macroeconomic and geopolitical uncertainties, particularly the ongoing US-China trade tensions and the US government shutdown, are weighing heavily on the crypto market, contributing to its recent downturn. Additionally, Binance Coin is facing headwinds from waning demand in the derivatives market. Data from CoinGlass reveals a 14% drop in open interest for BNB futures contracts over the past 24 hours. The long/short ratio has also dipped to 0.88, signaling bearish sentiment among traders and further pressuring BNB’s spot price.
Will BNB Price Rebound?
Despite the prevailing bearish trend, analysts remain bullish on Binance Coin, setting ambitious long-term targets of $2000 or even $2100. Drawing parallels with past cycles, such as the 2021 rebound following a 70% correction, fuels optimism among investors.
Meanwhile, analytics platforms like More Crypto Online posit that the BNB price mirror the patterns of Bitcoin. They added, “It is likely that the support zone will be tested once more. Support is between $742 and $934.”
At the same time, analyst BATMAN noted that BNB has been following a bullish trendline since reaching $600, with a smooth transition to $1,300. According to the analyst, the price is currently approaching this trendline again, coinciding with a previous resistance level and bullish FVG (Fair Value Gap). This technical setup suggests a potential opportunity, with the analyst predicting a new ATH on the horizon.
