Why steering clear of Binance Coin is the best option right now

Why steering clear of Binance Coin is the best option right now

Disclaimer: The findings of the following analysis are the sole opinions of the writer and should not be taken as investment advice

The crypto-market did find some relief after the sell-off on 7 September, but profit-taking continued to drive prices south just prior to the weekend. Binance Coin has been no exception to this wider trend. The altcoin did recover lost ground on the back of an ascending triangle breakout, but its price was immediately rejected at the resistance barrier.

The altcoin’s price can now be expected to trade within a range as a clear trend emerges. At the time of writing, BNB was trading at $414.6, down by a marginal 0.9% over the last 24 hours.

Binance Coin Hourly Chart

BNB’s losses were cut short at the $390-support level, although a few candlewicks did pierce below the defensive line. Buyers seemed to hit back with an ascending triangle breakout, but the resistance point of $437 prevented further upside.

As volatility looks to settle in the market after some haphazard movement, a period of consolidation can be expected between $437 and $410. Incidentally, the bottom range of this channel coincided with the lower band of the Bollinger Bands.

When the candles do shift to the lower band, some buying can be usually observed. On the other hand, support lines of $390 and $372 would be activated in case BNB tumbles further south.

Reasoning

While the hourly RSI seemed to stabilize between 45-40, there was room for an additional push towards the oversold zone before chances of a reversal. Meanwhile, momentum was weak on either side as the Squeeze Momentum Indicator shifted towards the half-line.

Black dots indicated that a market squeeze was in effect at press time. The MACD also shared similar sentiments as the fast-moving line was intertwined with the Signal line.

Conclusion

With neither side holding any aces, BNB could settle within the zone of $410-$437 over the near term. Low volatility can be expected to stem any further bleeding as a stronger trend emerges across the broader market.

Traders are advised to steer clear of rangebound markets as there seems to be an air of uncertainty around BNB’s outlook.

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