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- Technical indicators for BNB showed further gains were likely for Binance Coin
- The drop in Open Interest showed sentiment was not strongly bullish in the futures market
Binance Coin [BNB] has labored under a downtrend since May. This downtrend was uninterrupted on the higher timeframe charts such as the daily, but there have been lower timeframe rallies that served as pullbacks in the larger trend.
Read Binance Coin’s [BNB] Price Prediction 2023-24
At the time of writing, BNB was amidst a significant bounce. This move higher had stalled at the $212 resistance, but evidence from the indicators showed the bullish prospects were good.
The two-week BNB range formation continues to hold firm
Source: BNB/USDT on TradingView
Since 11 September, Binance Coin has been trading within a range (orange) that extended from $203.9 to $221.3. The mid-point of this range was at $212.7. It was exactly here that Binance Coin saw a rejection just a few hours before the time of writing.
The Relative Strength Index (RSI) remained above neutral 50 and the Chaikin Money Flow (CMF)’s reading of +0.11 showed significant amounts of capital were entering the BNB market. The On-Balance Volume (OBV) has also trended higher over the past two days. Therefore, it appeared highly probable that Binance Coin would break past the $212.7 resistance and climb to $221.
Bulls can wait for a move above $212 and a retest of the same as support before buying. Alternatively, in the event we see a dip to the H4 bullish order block at the $203-$207 region (cyan box), that can serve as a buying opportunity too. In either scenario, the take-profit target would be the range high.
The Open Interest chart showed bullish conviction has faded
Source: Coinalyze
Over the past few hours, even as the price of the exchange token climbed to $212, the Open Interest (OI) fell swiftly from $327 million to $320 million. This was odd because the expectation is that bullish conviction would rise as BNB noted gains within the range.
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Yet the drop in OI as prices tested the mid-range resistance showed bullish sentiment was weak and speculators preferred to take profits. The spot Cumulative Volume Delta (CVD) was in a hefty uptrend over the past two days and indicated Binance Coin was likely to rally once more, even if it first saw a dip to the $207 level.