Binance Coin (BNB) price has completed its correction structure and is moving towards the November 2021 high of $398.
Federal prosecutors are investigating the Binance exchange as part of a hedge fund probe. Additionally, FTX founder Sam Bankman-Fried said that the Binance CEO caused the crash, and he blamed Binance for the implosion of FTX.
In positive news for Binance, the exchange has officially launched Binance Mirror, a crypto payment solution that allows institutional investors to store their backing assets with leverage on the exchange. This is a big step in Binance’s appeasement policy towards institutional investors.
Additionally, BNB is still burning, with the 22nd burn completed on January 17th. A total of 2,064,494 of his BNB coins were burned, worth him $575 million.
long range recovery
Technical analysis from the weekly timeframe shows that Binance Coin price has regained the $250 horizontal support area after falling below $250 in May 2021 (green circle).
It then reached a high of $398 before falling, forming a long upper wick and testing the $360 area as resistance.
Since then, the price of Binance Coin has remained stable within this range. The ongoing upside movement has resulted in higher lows relative to May 2021 lows. This is considered a bullish sign. This is the first indication of an ongoing downtrend as all-time highs may end.
Moreover, the weekly RSI is bullish as it broke out of the descending resistance line and crossed 50.
A week close below $250 could invalidate this bullish outlook and send BNB’s price crashing towards $200.
Number of Waves in Binance Coin Price Suggests Rally Continues
The decline from Nov 8th to Dec 16th is almost certainly an ABC correction structure. This is clearly a three-wave structure, with a ratio of waves A:C of 1:0.618, ending at the 0.786 Fib retracement support level (white). As a result, all signs point to a completed ABC structure (black).
If that is correct, there are two possibilities for the future Binance coin price action. Both points to a continuation of the short-term uptrend, although they have fallen slightly over the past 24 hours.
The bullish scenario suggests that BNB price has started a new five-wave upward movement (red). It is now in its third wave and will eventually exceed $400. A break below one of the wave highs of $255 (red line) will invalidate this potential outline.
The bearish scenario suggests that BNB price is still in ABC’s major correction structure (white). However, the initial drop is a 3-wave structure as mentioned earlier, so we expect BNB price to reach at least $372 before falling.
Therefore, the reaction of Binance Coin price after it reaches there may determine the future trend direction.
In conclusion, while the price movement of Binance Coin is still unknown, a rally towards $370 is the most likely short-term outcome. A break below $255 will invalidate our short-term bullish outlook. In that case, the price of Binance Coin is expected to drop towards $200.
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