Disclaimer: The information presented does not constitute financial, investment, trading or other advice and is solely the opinion of the author.
- Market structure in daily and lower terms was bearish
- A bounce from $220 was taking place, but was faced with resistance at $240
There has been a lot of fear around Binance in recent weeks, following the FTX implosion. These fears were clearly visible on the price charts of the Binance Coin exchange token. [BNB].
It’s more, CryptoQuant The recent report on Binance’s Reserve Proof highlighted that its liabilities were 97% secured by exchange reserves.
What does the Binance Proof of Reserve (PoR) report tell us from an on-chain perspective?
A short thread 👇@binance @cz_binance pic.twitter.com/2vAoOmFb63
—CryptoQuant.com (@cryptoquant_com) December 15, 2022
Read Binance Coins [BNB] Price prediction 2023-2024
These data suggested that Binance did not exhibit Behavior similar to FTX. The report from him was more to determine that Binance did indeed hold the amount of BTC they claimed to hold, and not to generate positive sentiment about the exchange.
Binance Coin Falls Below $250 Mark, Bulls Fight To Recover $240
Price charts have been massively skewed in favor of the bears over the past week. In late November, BNB moved higher to test the $315 resistance level and faced rejection. Until December 11, the price embarked on a gradual downtrend, which seemed to be more of a pullback before another push.
However, this idea was quickly invalidated when Binance Coin fell below the support level of $276. He retested the same as the resistance on December 14. The area above marked in red represented a bull order block on the 12-hour chart.
During the dip, the area produced a positive reaction, forcing a bounce to $276. However, the downtrend was too strong, and this block of bullish order became a bearish brake.
A retest of this switch could offer short selling opportunities, targeting the $216 level that served as support in July. The invalidation of this bearish notion would be a move back above the $260 mark and the highlighted switch.
The average age of the coin is rising, but the funding rate plunged to show bearish sentiment
The sharp drop in the funding rate meant that short selling was becoming an overcrowded trade. While this showed strong bearish momentum from futures traders, it also meant that a move higher could force these shorts to close long and fuel further rallies.
Such a move towards the $250 area, if it materializes, could be used by the bears. However, the coin’s median age of 90 days has been on a steady uptrend since late November.
This suggested that BNB tokens did not experience increased on-chain activity, which typically occurred alongside heavy selling. On the social front, weighted sentiment was negative last week. Social domain also shot up to 10.8% earlier this month, but has since declined.
The open interest metric rose sharply since December 12. This was the day that BNB fell from the $290 mark, which shows that short positions were probably opened. Thus, the selling pressure observed in the futures market was highlighted.
The OI surge, coupled with falling prices, once again underscored the strong bearish sentiment behind BNB.
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