• Binance Coin (BNB) recently suffered a temporary loss of trust and price losses after the collapse of FTX and an opaque proof of reserves.
• The BNB price has risen 9.3% over the last seven days, reaching $301 at press time.
• The BNB is currently in a crucial scenario, with a potential downtrend developing if the price breaks the neckline at $210.
The world’s leading cryptocurrency exchange, Binance, is no stranger to volatility and uncertainty. In the wake of FTX’s collapse, Binance has seen its fair share of turbulence, including an opaque proof of reserves, the withdrawal of accounting firm Mazars, and a bank run on the exchange. These events caused a temporary loss of trust and excessive price losses for the associated Binance Coin (BNB).
However, investors are slowly regaining confidence in Binance and the BNB price has risen 9.3% over the last seven days, reaching $301 at press time. This bullish sentiment was further boosted by positive news from Binance yesterday and today.
Despite this, the BNB price is facing a bearish pattern on the weekly chart. The pattern usually predicts a trend reversal and consists of three peaks, with the two outer ones close to each other and the middle peak being the highest. The left shoulder forms when investors drive the price up and then temporarily lose their enthusiasm, while the head builds up when enthusiasm reaches its peak. The right shoulder forms when the price rises again, but does not reach its previous peak before falling again.
The head of the BNB weekly chart was formed in the week when FTX filed for bankruptcy. In the following weeks, the price fell before BNB experienced a recent rally due to the generally bullish market sentiment.
At this crucial juncture, if BNB breaks the neckline at $210 to the downside, the chart pattern could validate and BNB could see a downtrend within the next few weeks, pushing the price toward $153. Therefore, the current market sentiment will be key in determining the future of BNB in the coming weeks.