Binance Coin (BNB) price completed a corrective structure and is heading towards the November 2021 high of $398.
Federal prosecutors are probing the Binance exchange as part of an investigation into the hedge fund. Additionally, FTX founder Sam Bankman-Fried blamed Binance for the FTX implosion, stating that the Binance CEO prevented the crash.
In some positive news from Binance, the exchange officially launched Binance Mirror, a crypto settlement solution that allows institutional investors to store their backed assets using leverage on the exchange. This is a big step by Binance towards appeasing institutional investors.
Furthermore, BNB burning is still happening, with completion on January 22nd 17th. A total of 2,064,494 BNB coins were burned with a value of $575 million.
long-term range reclaim
Technical analysis from the weekly time frame shows that Binance Coin price retested the $250 horizontal support area after its downside divergence in May 2021 (green circle).
Later, it spiked as high as $398 before correcting lower, in turn forming a long upper wick and validating the $360 area as resistance.
Since then, the price of Binance Coin has consolidated within this range. The ongoing upward movement created a higher low relative to the May 2021 low, which is considered a bullish sign. This is the first signal that suggests that it is in a downtrend since the end of the all-time high.
Besides, the weekly RSI is bullish as it broke above the descending resistance line and moved above 50. This supports the possibility that BNB price will continue higher towards the $360 high.
A weekly close below $250 would invalidate this bearish outlook.
Binance Coin Price Wave Count Suggests Rally Will Continue
The decrease from November 8th to December 16th is almost certainly an ABC corrective structure. This is definitely a three-wave structure, with a wave A:C ratio of 1:0.618, and ended at the 0.786 Fib retracement support level (white). Consequently, all indications point to it being a complete ABC structure (black).
If this is true, then there are two possibilities for the future Binance Coin price movement. Both indicate that the uptrend is likely to continue in the short term, despite a slight decline in the past 24 hours.
The bullish scenario shows that BNB price has started a new five-wave upward movement (red). It is currently in the third wave and will eventually move above $400. A downside break below the wave at $255 (red line) would invalidate this potential pattern.
The bearish scenario shows that BNB price is still in a large ABC corrective structure (white). However, BNB price is still expected to reach at least $372 before a drop because the first drop is a three-wave structure as mentioned earlier.
Therefore, the reaction of the Binance Coin price once it is found will determine the direction of the future trend.
To conclude, while the price action of Binance Coin is still unclear, an increase towards $370 is the most likely short-term outcome. A drop below $255 will invalidate this short-term bullish outlook.
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