Binance Coin (BNBUSD) Technical Analysis: Bullish Channel Support Test

Binance Coin recently suffered a sharp drop and is down to the very bottom of its ascending channel on the 4-hour time frame. If support holds, price could aim for the Fibonacci extension levels next.

The 38.2% level lines up with the mid-channel area of interest at the 6.175 mark while the 50% level is closer to the 7.000 level. The 61.8% level is around 7.140 and the 78.6% level lines up with the channel top around 7.500. The full extension is located at 7.829.

The 100 SMA is above the longer-term 200 SMA to indicate that the path of least resistance is to the upside. In other words, the uptrend is more likely to resume than to reverse. However, price is trading below both moving averages to indicate that bearish momentum might be returning soon. A break below the channel bottom around 6.025 could spur a reversal.

Stochastic is already indicating oversold conditions or that sellers are exhausted and may be willing to let buyers take over. If so, BNB could bounce back to any of the nearby resistance levels. Similarly RSI is already pulling out of the oversold level to signal that buyers are returning.

Volume has faded since the sharp spike that accompanied the recent selloff, indicating that traders may be waiting for the next clues before piling on larger positions.

Cryptocurrencies have been in the red for the most part of the week as the rise in Tether is being blamed for the sharp decline in bitcoin and the spillover to the rest of the altcoins. It doesn’t help that bearish commentary is once again being highlighted, thereby exacerbating the declines.

With that, many worry that the coins are far from bottoming out, more so sparking the much anticipated rebound. Still, there’s news that Fidelity might be ready to launch its institutional platform in March, which might revive demand for bitcoin and its peers.

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