Binance Coin (BNB) price fell below the upward trend line support on Wednesday, signaling a break in the bullish market structure.
On-chain data shows that the long-to-short ratio for BNB is less than 1, indicating a bearish trend.
A daily candle close above $588.3 would invalidate the bearish argument.
Binance Coin (BNB) is the native token of the world’s largest cryptocurrency exchange, Binance. While BNB has multiple use cases within the Binance ecosystem, it is also widely used by investors to understand the growth and success of the exchange.
BNB fell below the upward trend line support on Wednesday, dropping 3% on Thursday. On-chain analysis indicates a long-to-short ratio below 1, suggesting bearish sentiment and implying a potential price drop for BNB in the coming days.
If the trend line acts as a resistance, BNB’s price could plummet by 11% and retest the low of March 19 at $495.8.
The daily chart’s relative strength index (RSI) and momentum oscillation indicator (AO) support the bearish argument, as both indicators are below their respective neutral levels of 50 and 0. This suggests continued favor for the bearish momentum, potentially leading to further price declines for Binance Coin.
The long-to-short ratio measures the market sentiment and potential future price trends in the cryptocurrency market based on traders’ relative positions.
For BNB, the long-to-short ratio is 0.759.
This ratio below 1 typically reflects a bearish market sentiment, as more traders expect asset prices to fall, further strengthening the bearish outlook for Binance Coin.
However, if the daily chart price of BNB closes above $588.3, it will create a higher high since July 1, signaling a breakout in the market structure.
This move would invalidate the aforementioned bearish argument, potentially triggering an 8% rise from the previous resistance level at $635.4 since the high point on June 12.
The bears will attempt to push the price down and keep it below the immediate support level of $551. If they succeed, selling pressure may intensify. BNB/USDT could plummet to $536 and eventually stabilize at the strong support level of $495.
On the other hand, a bounce from $551 would indicate strong demand at lower levels. Bulls must push the price above the 50-day moving average ($604) to indicate that the pullback may have ended. The currency pair could then rise to $635.
