The ongoing price boom in the Binance Coin (BNB) market is painting a classic bullish chart pattern with a target of $560.
Called Cup and Handle, the pattern appears when the price forms a lead that appears as a U-shaped trend (Cup). This follows with the formation of a descending channel band (Handle). A break above the loop range usually leads to a bullish continuation, with a target at a length equal to the size of the Cup.
Therefore, it appears that the BNB has gone through a price trajectory that looks like the Cup and Hand pattern. In addition, the cryptocurrency’s latest rally, accompanied by an increase in trading volumes, has pushed its prices above the upper range – a breakout – which has increased the possibilities for continued bullishness ahead.
As a result, if the rise in BNB prices is sustained, there will be a run towards the Cup and Handle breakout target close to $560. On the other hand, if the price falls below Cup resistance (~$437) , there would be a risk of invalidating the entire high setting.
Basics of BNB Pricing
BNB’s latest price hike came after Binance, through its blockchain project Binance Smart Chain (BSC), launched a $1 billion fund to accelerate adoption across the crypto industry. This earmarks $300 million for decentralized application building projects at BSC.
Traders typically view incubation events supported by blockchain projects as optimistic for their native assets. These events lead developers to create new projects in dedicated public/private ledgers, which increases demand for their internal tokens.
For example, in early October, Solana, a first-tier public blockchain protocol, announced more than $5 million in rewards and start-up funding for developers participating in its global hackathon called Ignition. The news helped push the price of Solana’s native token SOL up 35%, as the Cointelegraph covered.
The BNB appeared to have gone through a similar bout of speculation
Santiment, a crypto data tracking service, also detected an increase in BNB accumulation in portfolios that already have millions of dollars worth of tokens. The so-called Binance Coin whales have purchased around 412,000 BNB in the past two weeks, adding 8.7% more tokens to their existing properties.
The accumulation of BNB among wealthy investors has increased despite warning signs from regulators in some countries.
Binance is also still under investigation by various agencies in the United States, which it took several hedge funds, including Tyr Capital and ARK36, have stopped or reduced trading on their cryptocurrency exchanges.
The views and opinions expressed herein are those of the author alone and do not necessarily reflect the views of Cointelegraph.com. Every investment and trading move involves risk, you must conduct your own research when making a decision.
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