BNB, one of the top ten largest cryptocurrencies by market capitalization, demonstrated impressive performance recently. Within 24 hours, BNB surged by close to 6% to reach $633 – marking its highest value in five months.
As a result of this surge, BNB’s market cap increased by over $5 billion, reaching $91 billion. Despite these gains, BNB has not yet reclaimed its position as the third-largest non-stablecoin, a spot currently held by Solana (SOL).
While positive market sentiment has contributed to BNB’s upward trend, there might be additional factors behind this rally.
Support from Buyers Boosts BNB
An examination of buying patterns on BNB’s daily chart indicates a significant increase in buying pressure. Notably, the volume histogram bars have turned green, suggesting a shift in control towards buyers.
The Relative Strength Index (RSI) at 66 confirms robust bullish momentum. With the RSI generating a buy signal by crossing above the Signal Line and showing higher highs, it indicates a strengthening uptrend currently.
The Chaikin Money Flow also reflects a positive value of 0.08, showing a northward trend. This suggests that more capital is flowing into BNB in recent times.
If the buying support persists, BNB could potentially challenge the next resistance level at $652. Breaking past this level could pave the way for further price increases.
Alternatively, given the usual weekend volatility accompanying recent gains, there’s a possibility of the altcoin retracing to test support at $585 should traders rush to secure their profits.
Optimistic Sentiment from Open Interest
Increased volumes are not limited to the spot market; they are also evident in the derivatives market. Data from Coinglass reveals that BNB’s Open Interest (OI) surged by 27% to $738 million in just 24 hours.
BNB’s OI is currently at its peak since June, indicating that derivative traders are expanding their positions on the altcoin. When the Open Interest rises alongside the price, it signifies strengthening bullish sentiment.
Most of the new positions seem to be from long traders, as evidenced by the rise in the long/short ratio from 0.90 to 1.11. Funding rates have also exhibited positivity over the previous week.
DeFi TVL on BNB Chain Driving the Surge
Data from DeFiLlama illustrates a gradual increase in BNB Chain’s DeFi Total Value Locked (TVL) to $4.90 billion presently, the highest level since late July.
Notably, decentralized finance (DeFi) activity has notably surged over the past week, as reported by CryptoCrypto. With BNB Chain being the fourth-largest blockchain by DeFi TVL, any spike in DeFi activity is expected to positively impact the altcoin’s price.
Despite promising on-chain data, Market Prophit’s findings suggest that smart money sentiment towards BNB is yet to turn bullish. These traders may be awaiting confirmation of the uptrend’s strength, especially if BNB surpasses the resistance at $652.