Technical Analysis and Market Entry: Binance Coin (BNB/USDT) Testing a Critical Area of Support
- Binance Coin remains within the control of the market bears, trying to find a firmer footing.
- BNB is pulling back after hitting an all-time high print up within the $39 territory.
BNB/USDT: Recent Price Behavior
Binance Coin is presently stuck within a near-term bear trend, following the strong push up to the back-end of June. BNB was able to print a new all-time high within the $39 price territory before running into sellers. It was produced on 22nd June, but has dropped some 23% since. Given the consistent upside pressure that has been observed throughout 2019 so far in its recovery, the price is subject to dips.
During the journey north since the beginning of this year, BNB/USDT has encountered small pullbacks in the price. The occurrences are very much technical corrections or profit-taking as the bulls recharge. Typically these are bought by the bulls who are driving the price further too new high areas.
Bull Flag Retest
BNB/USDT last month broke out from a bullish flag pattern formation, which means a retest of the structure has already been seen. The described price behavior helped the bulls on to the earlier noted all-time high. However, given the current downside momentum in play, there may be room for another test of this level.
Key Supporting Trend Line
There is a running ascending trend line that has been in play since May, which is supporting the price in its move to the upside. On each occasion that BNB/USDT has come into contact with the trend line, a decent boost has been provided. The bears at the time of writing are testing this support to the downside, which could if broken be devastating.
If such a breach occurs, fortunately enough for the bulls, there is a known area of demand seen just below. It can be seen tracking from $30.50 down to $29.50, which has found buyers on several occasions in June and May. Should this fail to catch the falling price, then expect a chunky potential wave of selling pressure.
If the price produces a daily closure below the noted trend line of support, around $32, then look for near-term shorts. The next major area of interest would be $26-$25 (in proximity to this is the 38.2% Fibonacci). These are two noted confluences of support for the price to find some ground and stage a potential rebound. Stops on this would be placed back above the trend line at around $35.
On the other hand, if the daily closure is not seen below the trend line, then eyes on further upside. Target areas of interest would be $40 and $45, with stops being placed at $29.
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.
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