Binance Coin (BNB) shows strength despite market-wide correction

Binance Coin (BNB) has managed to bounce back and hold above the short-term support. However, it is showing some signs of a long-term bear market.

Long term context

The NBB has been on the rise since May 23rd. The upward movement continued until November 7, when the BNB peaked at $ 669, after which the token was rejected and quickly fell.

The rejection confirmed a descending resistance line created from the all-time high in May, and the token could trade within a large symmetrical triangle that is believed to be a pattern.

After the decline, the NBB bounced off the horizontal support area of ​​$ 500, creating a long wick underneath. This is seen as a sign of pressure to buy.

However, despite the recovery, technical indicators continue to decline.

The MACD, formed by the short and long-term moving averages, is falling. This is a sign that the short-term MA is slowing down compared to the long-term MA.

The RSI, which is a momentum indicator, is below 50. The 50 line is considered a benchmark for an upward / downward trend, so a decline below it indicates a downtrend.

Daily BNB / USDT Chart | Source: TradingView

The jump continues

The 6-hour short-term chart offers a more bullish outlook.

First, the BNB acts in a descending parallel channel. Such channels often contain corrective movements, which means that a breakout is expected.

Second, the rebound came at the confluence of the channel’s support line and the 0.5 fib retracement support at $ 495.5.

Hence, the correction may be complete and BNB will eventually break out over the channel.

BNB / USDT 6-hour chart | Source: TradingView

Looking at the hourly chart, the uptrend on December 4th (highlighted) resembles a five-wave pattern. Hence, it is likely that the next decline will be a correction and after that the NBB will resume its uptrend.

To do this, the BNB must hold above the short-term 0.5 fib retracement support at $ 535 and hit a higher low.

Hourly BNB / USDT Chart | Source: TradingView

Future movement

Trader @CryptoCapo_ tweeted a BNB chart saying that a break above the current long-term pattern could trigger a very strong uptrend.

The fractal is visible when looking at the 3 day timeframe on a logarithmic graph.

Initially, BNB was traded within an ascending parallel channel from June 2020 to January 2021. When the token then erupted over the channel, the rate of increase accelerated.

Therefore, if the BNB can break above its current level, a similar rally could follow.

BNB / USDT 3-day chart | Source: TradingView

You can see the price from BNB Here.

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Disclaimer: This article is for informational purposes only, not investment advice. Investors should research carefully before making a decision. We are not responsible for your investment decisions.

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