Altcoins
BNB wants to cross $600, but why the altcoin may fall to $550 instead
- A bullish invalidation could send BNB down to $561.
- Funding rate and sentiment were negative, suggesting a bearish bias.
Binance [BNB] could attempt to exit according to the 4 hour chart. But AMBCrypto’s analysis revealed that this effort could be in vain.
One of the reasons for this prediction is the exponential moving average (EMA). This indicator measures the direction of the trend over a certain period of time.
At press time, BNB changed hands at $586. But the 20 EMA (blue) and the 50 EMA (yellow) were in the same place. The EMA positions indicated the hesitation of the bulls and bears to direct the price action.
Therefore, BNB could trade in a tight range unless a crossover occurs.
The golden cross has disappeared: the next death cross?
If the 20 EMA rises above the 50 EMA, the price could extend around $593. But that seemed unlikely, as BNB’s next target could be $561, which is where the last gold cross occurred.
For those unfamiliar, the golden cross is the terminology used to describe a situation where the 20 EMA rises above the 50 EMA. If the 50 EMA rises above, it is called a famine cross.
Source: TradingView
In addition to the indicator above, another which suggested a decline was the Money Flow Index (MFI).
This indicator uses price and volume data to show whether a cryptocurrency is under buying pressure or not.
At press time, the MFI had fallen to 66.04, indicating that BNB buying volume had declined. If the reading continues to decline, the bearish thesis could be validated.
However, this AMBCrypto analysis was not the only one to share this view. A review of on-chain data revealed that a large portion of the market expects the price of BNB to fall.
Bears double their bet
This was clear from the balanced feeling, which was negative at the time of going to press. This negative value shows that most comments about BNB on social platforms were bearish.
As long as that stays the same, it might be difficult for the price to climb. On the other hand, if remarks on BNB start to turn bullish, the trend could change.
Furthermore, an examination of the funding rate showed that it was at the extreme end of the negative zone. The funding rate means more traders have turned to short positions.
Source: Santiment
If the financing was positive, this would have implied that traders bullish on the part. Additionally, financing also impacts the price. At press time, BNB price declined while funding was negative.
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The reasonable conclusion here is that fraudulent sellers are aggressive and get rewards for their positions.
In a case like this, BNB could dampen a bullish move, and a possible decline could be the next step unless spot buyers save the day.