HomeLatest NewsBNB breaches key support but be aware of false breakout as bulls take charge

BNB breaches key support but be aware of false breakout as bulls take charge

Motiur Rahman
  • Binance coin has returned more than 77% since the June bottom price.

  • The token hit the resistance target at $326, forcing profit-taking activities.

  • BNB has temporarily broken below key support, although a bearish momentum is not yet confirmed.

By all means, Binance coin BNB/USD has returned massively for investors who targeted $326 resistance. The level, hit during the first week of August, represents an upsurge of 77% since BNB bottomed at $142. To a technical reader, $326 represents a take-profit zone. That reveals why the token lost momentum after hitting the level. BNB now trades at $280.

BNB slowdown is connected to profit-taking activities rather than weak fundamentals. Whereas the price could climb above $326, investors remain cautious as the recession risks remain. As of press time, most cryptocurrencies remained in the red. However, we can’t confirm a bear market as of now. 

BNB trades at a key level as price slides

Source – TradingView

From the daily chart outlook, BNB is under pressure. The momentum line has crossed below the moving average, suggesting a bearish push. The cryptocurrency has also broken above the 21-day MA but remains supported by the 50-day MA. 

Two scenarios are likely as BNB trades at key support of $285. In the bull case scenario, the daily candle stick could close above the support, leaving a bearish pin bar. That will allow bulls to take control and push the token back to $326. The scenario will see BNB remain supported by the 50-day MA.

In the bear scenario, the daily candlestick will close below the support zone. That could be followed by a bear confirmation candlestick. The bear scenario will see BNB move back to $244.

Concluding thoughts

Investors should watch the close of the daily candlestick on BNB. That will reveal whether BNB will enter a bear market or begin a bull reversal.