Binance Coin (BNB) has plummeted by more than 7% over the past week. Since August 23, the cryptocurrency has been consistently trading below a descending trend line, confirming an ongoing bearish phase.
Current BNB Scenario
Currently trading at $522, BNB has experienced a sharp decline from its monthly peak of $600 reached on August 23. The prevailing bearish sentiment suggests that this downward trajectory may persist in the near term, potentially testing lower support levels.
Can BNB Recover?
Technical indicators offer little solace for BNB bulls. The Moving Average Convergence/Divergence (MACD) indicator presents a decidedly bearish outlook, with BNB’s MACD line (blue) positioned below both its signal line (orange) and the zero line. This configuration typically signals strong bearish momentum, often interpreted by traders as a cue to exit long positions or consider short entries. Complementing the MACD’s bearish signal, the Directional Movement Index (DMI) further reinforces the negative sentiment surrounding BNB. The negative directional indicator (-DI) currently dominates its positive counterpart (+DI), indicating robust bearish control over the market. The derivatives market for BNB echoes the bearish sentiment observed in spot trading. Futures open interest has seen an 18% decline since BNB began trading below the descending trend line, according to data from Coinglass. This reduction in open interest typically signals that traders are closing positions and exiting the market, potentially exacerbating downward price pressure.
Outlook and Conclusions
Looking ahead, if the current bearish momentum persists and buying pressure continues to wane, BNB could face a breach of the psychologically important $500 level. A potential recovery point could be the $522.90 mark.
The current market scenario suggests the continuation of the bearish trend for BNB in the short term. The prevailing technical indicators and the reduction in futures open interest reinforce the negative market sentiment.
Comments