BNB is currently at a critical juncture. Will prices decline or rally?
- BNB has entered a supply zone, which often acts as a catalyst for potential declines. However, several indicators suggest that BNB may navigate this challenge successfully.
In the past week, Binance Coin [BNB] has shown steady growth, with a modest increase of 2.68%. In the last 24 hours alone, it has gained 1.14% as it moved into the supply zone.
While trader sentiment remains bullish, BNB must contend with significant obstacles that could hinder its rally.
BNB faces obstacles on the chart
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AMBCrypto’s analysis shows that BNB has entered a significant fair value gap (FVG) supply zone identified on the 4-hour chart, ranging from $580 to $590. This zone is likely to restrict upward price movement.
Typically, an FVG supply zone serves as a catalyst for downward pressure, which can lead to losses for investors.
The last time BNB traded within this zone, it experienced a 6.02% decline over two days, reaching a low of $551.50.
If the market moves lower again, BNB may fall to around $558.90. However, if bullish momentum takes over, it could rise to approximately $618.60.
Source: Trading View
AMBCrypto reports that trading activity in the market is currently supporting a potential upward movement.
Short traders record major losses
The market is currently seeing a significant imbalance in liquidations, with short traders bearing the brunt of losses.
At the time of writing, short traders have been liquidated to the tune of $463.05k, compared to $94.89k in long liquidations.
This imbalance suggests a bullish market, as more short positions are being closed, signaling upward price momentum for BNB.
Additionally, the Funding Rate has remained positive. A positive Funding Rate means long traders are paying short traders, reflecting strong buying demand and indicating that the market expects further price gains.
Source: Coinglass
The Aroon Indicator also supports this bullish sentiment. The Aroon Up line, which measures the time since the last price high, is currently above the Aroon Down line, showing a reading of 85.71% to 50.00%.
This indicates that a bullish trend is in play.
Source: Trading View
If this bullish momentum continues, BNB is likely to move higher, with further upward trends expected in subsequent market session.
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