The price of BNB (BNB) has broken down below an ascending triangle pattern, and it may continue to decline in the near future.
Ascending triangle pattern: The price of BNB has been trading within an ascending triangle pattern since May 2022. This is a bullish pattern that often leads to a breakout in most cases. However, the price of BNB has failed to break out twice since then (highlighted in blue ellipses). This indicates a lack of buying pressure at higher levels.
Indeed, after two failed attempts, the price of BNB finally broke down below the triangle last week with a large bearish candle. Invalidating a bullish pattern is usually followed by a sharp decline as it is seen as a bull trap.
A measured move equal to the height of the pattern when connected to the breakout point would bring the price of BNB down to around $104, representing a decrease of over 50% from the current level.
The weekly RSI indicator supports the possibility of further decline as it dropped sharply below the 50 level and slopes downwards.
Short-term outlook: The 4-hour RSI indicator has formed significant bullish divergence within the oversold territory and broke above its resistance line. This suggests a short-term recovery may occur.
If so, the price of BNB could rise to the previous horizontal support area at $265.
However, the 4-hour candlesticks are predominantly bearish engulfing candles with high trading volume. This indicates that the bearish side has been in control of the market.
Therefore, this could be seen as a dead cat bounce, and the price of BNB could reverse at minor resistance levels at $240 and $254.
Conclusion: The most likely prospect suggests that the price of BNB will continue to decline in the near future. The most plausible target found is at $104.
