Can BNB bulls defend the $205 level in light of increasing selling pressure?
Disclaimer: The information presented does not constitute financial, investment, trading, or other types of advice and is solely the writer’s opinion.
- Binance Coin maintained its bearish market structure on the higher and lower timeframes.
- Sellers’ dominance could see BNB sink below $205.
Binance Coin [BNB] hovered at the range low of $205 with sellers looking to break the bullish resolve at the level. BNB’s sideways movement throughout September extended into October, as buyers failed to push past the $220 price level.
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The most recent rejection at the $220 level on 2 October led to a 6.5% drop. This provided another opportunity for sellers to flip the $205 support level to resistance.
Can sellers finally break the bullish defense of the $205 price level?
Despite BNB’s bearish market structure, the $205 support level has been a stronghold for bulls. Previously, the level has been tested thrice with bulls emerging victorious on each occasion.
However, critical price levels tend to weaken on multiple re-tests, as the pending buy/sell orders at that level are reduced on every retest.
A look at the on-chart indicators hinted that sellers could be successful on this retest. The Relative Strength Index (RSI) remained under the neutral 50 and edged toward the oversold zone. This highlighted the sustained selling pressure.
Likewise, BNB continued to see large capital outflows with the Chaikin Money Flow (CMF) reflecting the outflows by dropping to -0.10.
A break of the $205 support could see BNB head to the weekly support of $190. This would provide sellers with an 8% profit margin from the current price level. Alternatively, if the bulls hold the $205 support again, BNB’s range formation could persist in the long term.
Shorts in the majority
The exchange Long/Short Ratio from Coinglass revealed sellers positioning themselves to maximize the shorting opportunity.
Read Binance Coin’s [BNB] Price Prediction 2023-24
Shorts held a 52.12% share of the open contracts with a $6 million difference between short and long positions. This reflected the bearish bias with a high possibility of BNB hitting a sub-$ 200 price.