- BNB surged to a five-month high of $652 on the back of rising buying activity
- Open interest also jumped by more than 27% in 24 hours, with the long/short ratio showing demand for long positions
Binance Coin (BNB) was the best performer among the top ten largest cryptocurrencies by market capitalization at press time. In just 24 hours, BNB gained by nearly 6% to trade at $633 – Its highest price in five months.
Following these gains, BNB’s market cap rose by more than $5 billion to touch $91 billion. However, BNB is yet to reclaim its spot as the third-largest non-stablecoin after recently being flipped by Solana (SOL).
While the bullish sentiment across the broader market has supported BNB’s uptrend, is there more to this rally?
Buyers rally behind BNB
A look at buying activity on BNB’s one-day chart revealed that buying pressure has risen significantly. For instance, on the charts, the volume histogram bars seemed to have flipped green – A sign that buyers are now in control.
The Relative Strength Index (RSI) at 66 also underlined strong bullish momentum. After forming a buy signal after crossing above the Signal Line, the RSI was making higher highs – An indication that the uptrend was gaining strength at press time.
The Chaikin Money Flow also presented a positive value of 0.08, tipping north. Simply put, more capital seems to be flowing into BNB lately.
(Source: Tradingview)
If buyers continue to support this uptrend, BNB will likely test the next resistance level at $652. Flipping this level could set the stage for further gains.
Conversely, given that the recent gains have coincided with typical weekend volatility, it is likely that the altcoin could drop to test support at $585 if traders rush to book profits.
Open interest shows bullish sentiment
High volumes are not just being seen in the spot market, but also in the derivatives market. In fact, data from Coinglass revealed that in just 24 hours, BNB’s Open Interest (OI) hiked by 27% to $738M at press time.
(Source: Coinglass)
BNB’s OI is now at its highest level since June – A sign that derivative traders are increasing their positions on the altcoin. When the Open Interest is rising alongside the price, it means that bullish sentiment is gaining strength.
In fact, most of the new positions appeared to be from long traders. This, because the long/short ratio jumped from 0.90 to 1.11. Funding rates have also been positive over the past week or so.
BNB Chain’s DeFi TVL is fuelling the rally
Data from DeFiLlama revealed a slow, but steady hike in BNB Chain’s DeFi TVL to $4.90 billion at press time. This metric is now at its highest level since late July.
(Source: DeFiLlama)
As AMBCrypto reported previously, decentralized finance (DeFi) activity has risen significantly over the past week. Given that BNB Chain is the fourth-largest blockchain by DeFi TVL, a spike in DeFi activity is bound to have a positive impact on the altcoin’s price.
Despite the solid on-chain data, however, Market Prophit revealed that smart money sentiment is yet to flip bullish on BNB. These traders could be waiting for a confirmation of the uptrend’s strength, if the altcoin flips resistance at $652.
