Technical Analysis and Market Entry: Binance Coin (BNB/USDT) – Bullish Pennant Breakout and Retest

  • Binance Coin (BNB) over the last week had a decent push to the upside, initially gaining as much as 20%, before encountering some profit taking.
  • BNB/USDT bulls managed to smash out from a bullish pennant formation; eyes are on a retest.

BNB/USDT: Recent Price Behavior

Binance Coin over this last week has been with the control of the market bulls. The price has gained as much as 20%, jumping up to $36.40, another all-time high. It has at the time of writing on Friday run into some sellers, touted profit taking following the strong move. Before the most recent breakout, BNB/USDT was within consolidation mode.

The price of BNB has been on a significant incline since the beginning of 2019, after starting the year as low as $5.25. As noted above BNB/USDT pushed to an all-time high of $36.40, marking a gain year-to-date of some 570%. Any periods of dips in the price have been bought with some force by the market bulls. It is without a doubt the best-performer among the major altcoins.

BNB/USDT daily chart.

Bullish Pennant Structure

On 10th May the bulls took it up a notch, as the price rallied 13 out of 16 daily sessions. BNB/USDT during the noted period gained a whopping 90% before then consolidating. Binance Coin moved within a range-bound manner from 26th May to 10th June, taking time to consolidate. Price action formed a bullish pennant technical structure as a result of this behavior.

The bulls managed to force a breakout and a daily closure above the noted pennant. In the following session, BNB/USDT retested the pattern, making room for another push higher. The price has since run into sellers, producing an evening star formation on Thursday 13th June. A significant retest is in action; the support should be noted at $31.00, which is the pennant upper trend line that reveals an area of demand.

Trade Recommendation

An attractive buy opportunity is not too far from presenting itself, given the retest of the pennant which is in play. Placing a long in the $31.00-$29.50 range is attractive.

In terms of upside targets; firstly, a retest of the all-time-high print at $36.40. The pole of the noted pennant structure equates to the 90%. Should it play out to the textbook, then another similar move could be seen following a retest. A secondary target for BNB/USDT would then be up at the heights of $48. In this case, stops would be placed below the detailed demand zone and pennant structure at $28.

Disclaimer: The author owns Bitcoin, Ethereum and other cryptocurrencies. He holds investment positions in the coins, but does not engage in short-term or day-trading.

Featured image courtesy of Shutterstock.            

 

 

Author:
Ken has over 8 years exposure to the financial markets. During a large part of his career, he worked as an analyst, covering a variety of asset classes; forex, fixed income, commodities, equities and cryptocurrencies. Ken has gone on to become a regular contributor across several large news and analysis outlets.