Disclaimer: The findings of the following analysis are the sole opinions of the writer and should not be considered investment advice
Binance has been doing the rounds in the media for a number of reasons. Recently, the Securities Commission of Malaysia ordered the exchange to disable its website and cease offerings in the country for ‘illegally’ operating a Digital Asset Exchange. To add to Binance’s woes, financial services provider HSBC also suspended customer payments to Binance in the U.K., citing regulatory concerns raised by the FCA in June.
However, this has not stopped the world’s largest exchange from making new alliances to expand its network.
Amidst these events, Binance’s native cryptocurrency BNB seemed to be ignoring such developments and moved in accordance with broader market cues.
Binance Coin 4-hour chart
Source: BNB/USD, TradingView
BNB’s chart pictured the formation of higher highs and lower lows since 22 July. The V-shaped recovery allowed the price to form a new peak at $348, which was its highest level in over a month. Due to BTC’s retracement from $42k, the last few days resulted in a correctional phase for BNB as the focus shifted to the support zone of $325.6-$330.
Avoiding a close below this zone would maintain BNB’s bullish narrative going forward. In case of a breakdown, the 200-SMA (green) and $308 would be called into action.
Reasoning
The Stochastic RSI flashed a bearish crossover in the overbought region and underlined the potential risk of selling pressure. A bearish trend reversal was also on the cards as the Directional Movement Index’s +DI inched closer towards the -DI. Finally, the Squeeze Momentum suggested that bearish momentum was on a decline as BNB approached its defensive area.
Conclusion
There was evidence to suggest that bearish control would decline within the support area of $325.6-$330. This development would safeguard BNB’s ongoing uptrend. Traders can opt to long BNB within the zone, but must be mindful of bearish broader market cues. Especially since a fall below BNB’s 200-SMA might trigger a sharp market sell-off.
