BNB fails to flip crucial resistance block into support, trading at $520.
Open Interest in BNB Futures drops 20%, contributing to recent price decline.
Price could fall to $495 if $520 breaks; recovery possible if $550 becomes support.
Binance Coin (BNB) finds itself at a critical juncture as it repeatedly fails to overcome a major resistance block, with its own traders exacerbating the situation by withdrawing funds at the first signs of bearish market sentiment.
This confluence of factors has placed BNB in a precarious position, challenging its ability to maintain upward momentum.
The altcoin’s struggles are clearly reflected in the futures market, where Open Interest has seen a substantial 20% decline between August 23 and the present. This drop, from $614 million to $497 million, has directly contributed to BNB’s recent price weakness, underscoring the impact of trader sentiment on the token’s valuation.
Technical indicators further compound BNB’s challenges, with the Relative Strength Index (RSI) slipping into bearish territory. This shift signals growing caution among investors regarding BNB’s short-term prospects.
However, it’s crucial to note that RSI positions can be transient, and a reversal remains possible should broader market conditions improve.
Source: Coinglass BNB price could fall further
The coin’s price action tells a story of persistent struggle against a formidable resistance zone. Currently trading at $520, the token has experienced a drawdown over the past four days after encountering the five-month-old resistance block ranging from $575 to $619.
Since early March, BNB has made nine attempts to breach this barrier, succeeding only twice, with one instance resulting in an all-time high of $721 in early June.
The recent fall below the $550 support level suggests that BNB may require stronger bullish catalysts to reignite its upward trajectory. The uncertainty surrounding BNB’s ability to overcome the resistance block adds another layer of complexity to its near-term outlook.
Looking ahead, BNB faces a critical support test at $520. A breach of this level could potentially trigger a more significant decline, possibly leading to a retest of the $495 support zone.
Conversely, if bulls manage to reclaim the $550 level as support, Binance coin could stage a comeback, potentially re-entering the resistance block and invalidating the current bearish scenario.
