Once again, Binance Coin [BNB] was seen trading near its highest levels in a ten-week range. The unexpected release of former Binance CEO Changpeng Zhao from prison was anticipated to ignite a bullish sentiment in the market.
While there was a surge in bullish discussions on social media following CZ’s tweet, the price charts didn’t reflect the same enthusiasm. Following CZ’s tweet, BNB experienced a 3.9% decline in the next six hours. This, along with the sustained range highs, raised doubts about where the exchange token’s future trajectory might lead.
Potential Breakout Scenario
The range which has persisted for nearly three months spans from $464 to $604, with a midpoint at $535. This level has recently acted as both a support and a resistance zone. In September, BNB tested this level as support, then surged by 12.7% to reach the range’s peak.
Although the daily RSI has stayed in bullish territory above the neutral 50, a bearish divergence has emerged. The RSI showed a lower high while the price continued to rise, indicating a probable retracement.
Furthermore, the OBV failed to revisit the highs from July. A similar scenario unfolded in mid-August, resulting in BNB facing strong resistance at the $600 mark. These technical signals suggest that a rejection from the range highs is more plausible.
Liquidation Levels Point Towards $635 as Potential Price Target
Based on a three-month liquidation heatmap, the $621-$635 range seems to exert a magnetic effect on BNB’s price. Prior to this, the $600-$614 zone attracted prices before a pullback to $585.
There exists a possibility of a false breakout beyond the range highs, reaching $635 before retracing. Traders are advised to consider taking profits as BNB nears these levels, while also being prepared for a pullback that could offer a buying opportunity.
Disclaimer: The views expressed do not represent financial, investment, trading, or any other form of advice, and are solely the opinion of the author.