Binance Coin (BNB) Recoups Losses but Struggles with Resistance

However, BNB has reached an important resistance area which threatens to knock the price back down.

BNB Deviation Above Range High

On Sept 1, the BNB price broke out above the $23.50 resistance area to reach a high of $25.81. However, the price dropped sharply afterward, making the previous movement a deviation above the resistance (shown in the red circle below). The price found support at $18.80 and initiated a bounce that is still ongoing that has taken the price back to the $24 resistance. If successful in breaking out, BNB would likely move towards the next resistance area at $27. While the price action indicates that another rejection is more likely, technical indicators have begun to turn bullish. There is a bullish cross in the stochastic RSI, and both the MACD and RSI are increasing. Therefore, the outlook from the daily time-frame is uncertain.

The short-term chart is clearer, indicating that a decrease is more likely. Besides bearish divergences in the RSI, MACD, and Stochastic RSI, the price has created what seems like an ascending wedge, which is normally considered a bearish reversal pattern. BNB is expected to break down from the wedge, and head towards the $20.80-$18.80 range.

Wave Count

Due to the considerable overlap and lack of a five-wave structure, the long-term wave count for BNB suggests that the price is completing some type of complex W-X-Y correction (in black below). Based on the length of the W wave, we can determine a possible high of either $30.41 or $45.11 for the top of wave Y—the latter being more likely. If the count is correct, the price has completed sub-wave A (White) and is due for a short correction before resuming its upward movement.

A closer look reveals that the price has completed a five-wave impulsive formation (orange), which created wave A. A correction could take the price towards $16, after which the upward trend is expected to resume.

BNB/BTC

Cryptocurrency trader @PostyXBT outlined a BNB chart, which shows that the price is struggling to break out above a resistance area and a long-term moving average (MA).

The aforementioned resistance area is found at ₿0.00235. The area has rejected the price four times since October 2019. A resistance area gets weaker each time it is tested, so the price is expected to finally break out. Furthermore, technical indicators are bullish. The RSI has generated a yearlong bullish divergence, the stochastic RSI has made a bullish cross, and the MACD has already crossed into positive territory. If the price breaks out, the next resistance area would be found at ₿0.003.

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