Binance Coin [BNB] has retested the lows it established on Friday, the 6th of February, at $570. This was a worrisome sign for bulls and long-term investors, as it was a sign of bearish dominance.
The sellers were threatening to drive prices below the swing low at $570 and force the exchange token on its next downward move. The Coinalyze data agreed with the bearish dominance.
While the funding rate remained positive, the spot CVD has been steadily falling over the past week. Additionally, when the BNB price fell to $570, the Open Interest rose from $530 million to $560 million.
This meant that short sellers were entering the market during the move lower. The OI has slowed down since then, as the price briefly bounced to the $590 resistance.
The BNB woes are not just short-term
The relative weakness against Bitcoin [BTC] was a worry. The leading crypto’s February low was at $66k, and the current market price is $66.6k. Meanwhile, BNB tested the February lows.
Speculative conviction and a lack of demand could drive BNB even lower.
The RSI on the 1-day timeframe was at 34, showing strong bearish momentum. The OBV bounced higher in March but was slowly falling once more.
The $577 and $604 were the key levels to keep an eye on in the next few days. A bounce back above $604 would be a short-term win for the bulls, although they won’t get to dictate the overall trend.
Meanwhile, losing the $577 support will mean that the next target would be $530.
The 3-month liquidation heatmap showed that further downside was likely. There was a cluster of liquidity built up around $565 that could drag BNB lower.
To the north, the $650 and $700 regions had long liquidations and could be targeted in case of a price bounce.
Based on the evidence at hand, traders should anticipate a BNB move toward $530 next. A bounce to $600, or even as high as $650-$700, would be for selling.
Final Summary
- BNB fell swiftly on Thursday, the 2nd of April, to test the $570 support level that marked the February crash’s low.
- The surge in Open Interest during Thursday’s price drop signaled bearish speculative conviction.
