Binance Coin (BNB) Shows Potential for Recovery Despite Recent Decrease

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Binance Coin (BNB): Is a Recovery Looming?

Binance Coin, also known as BNB, could be on the verge of a recovery. Over the past seven days, the price of BNB has dropped from $334 to $291, representing a decrease of 6.14%. Compared to other altcoins, Binance Coin has shown stronger performance, as many other top altcoins have seen double-digit declines in the same period.

The Importance of the Funding Rate

The funding rate of Binance Coin, as analyzed by AMBCrypto, suggests that the coin could be ready for an upswing. The funding rate is an indicator that measures the difference between the perpetual price (Perp price) and the spot price of a cryptocurrency. If the funding rate is positive, the Perp price is trading at a premium compared to the spot price. If it is negative, the Perp price is trading at a discount compared to the index price. Currently, the funding rate of BNB is at -0.037%, meaning the Perp price is trading at a discount to the index price.

Caution in Possible Recovery

A high negative funding rate can be a potentially bullish sign. It means that short positions are aggressive and are not receiving any reward for it. Therefore, the price could find support. This has been the case with BNB in the past. For example, on December 18, the funding rate was at a similar value and the price of BNB was $243. By December 26, the coin value had risen to $305.

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The Liquidation HeatMap suggests that large-scale liquidations could occur between $320 and $325. Therefore, traders betting on these targets should be cautious.

Recovery in Sight?

On the 4-hour chart, bears seem to be in control. However, the bulls are attempting to retest the $299.4 support level. If the breakout succeeds, this could help break the $309.5 resistance. The Relative Strength Index (RSI) could support the upward movement, as it currently stands at 31.47, indicating that Binance Coin is oversold.

Should the bulls gain the upper hand, the oversold condition could trigger a recovery and possibly lead BNB towards $320. However, the 9 EMA (blue) and 20 EMA (yellow) are above the BNB price, indicating a possible decline. Nevertheless, a recovery of BNB remains an option, even if it may not occur in the next few days, but rather in the medium term.

Sources: AMBCrypto, Santiment, HyblockCapital, TradingView

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Isabella Brown

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Online Gambling, Greece and my dog Gringo are my three favorite things in my life. Before working for Kryptocasinos.com I was leading the content team of an iGaming Online magazine where I was focused on researching casinos, their licenses and the connection between the members of the industry.
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Last update: 19. February 2024

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