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BNB at critical point as bears and bulls fight for dominance

BNB at critical point as bears and bulls fight for dominance
Justinas
Baltrusaitis
6 months ago
3 mins read

Binance’s native token, Binance Coin (BNB) is one of the top cryptocurrencies by market capitalization that have reached major milestones this year, including an all-time high of over $672. 

As of December 28, 2021, BNB is being traded at $550, recording a +3.43% gain in the last 7 days. This price analysis is provided to assist you in determining what is most likely to happen next for Binance Coin in the market.

MACD shows BNB not out of the woods yet

BNB is showing seeming strength as its price is pushing upward in spite of the general bearish trend in the market now. Although a critical momentum indicator, Moving average convergence divergence (MACD) suggests otherwise. The indicator line is currently above the MACD for the token, indicating that it is still predominantly in a bearish trend although the trend isn’t so strong.

MACD showing BNB is still largely bearish. Source: Tradingview

A trend reversal will be confirmed if the MACD (blue line) crosses above the yellow indicator line. Even then, it should be given some time to confirm a change in the market direction.

Relative strength index (RSI) shows potential growth

BNB price is still in a bearish trend despite the marginal price increase seen now. The Relative strength index (RSI) is however still low. The lower the RSI, the greater the chance that the price is likely to rebound. 

At a 14-day average of 45.14, the asset could be in a position to recover as it is close to 30, a level that is considered to be oversold. This means that sellers have brought the price down low enough to experience another bounce. It is subject to other factors though, as it may still go lower than this.

Low RSI indicating BNB price may be due for recovery. Source: Tradingview

Contracting Bollinger Bands: BNB approaching critical decision point

Bollinger Bands (BB) indicate momentum direction and serve as indicators of volatility. Contracting BB as is the current case with BNB shows that it is approaching a critical decision point. The price at this point could break out either to the upside or to the downside. 

As the daily chart shows, buyers and sellers have been at almost an equilibrium with no clear winner. A breakout will determine if the price heads upwards or downwards, meaning the price gains recorded by BNB is not yet proof of a bullish trend until the bands open up and the price leans towards the upper band.

Contracting Bollinger Bands showing BNB at critical point. Source: Tradingview

Conclusion 

All in all, BNB price is currently in no specific trend, as bulls and bears are showing almost equal strength. This is a critical point of waiting for a clear trend to emerge. 

The volume further confirms the low volatility as it remains almost flat while the bulls and bears fight over dominance. The general market is still more bearish than bullish though, so unless something specific comes up, the BNB price could break to the downside from here.

Disclaimer: The content on this site should not be considered investment advice. Investing is speculative. When investing, your capital is at risk.

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Justinas Baltrusaitis
Author

Justin crafts insightful data-driven stories on finance, banking, and digital assets. His reports were cited by many influential outlets globally like Forbes, Financial Times, CNBC, Bloomberg, Business Insider, Nasdaq.com, Investing.com, Reuters, among others.

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