Binance Coin (BNB) has been caught in a downward spiral, echoing the broader cryptocurrency market’s decline. Over the past six days, BNB has plummeted, culminating in one of the highest liquidation volumes seen to date, a stark indicator of investor distress.
The sell-off began on July 31, with BNB shedding over 2% of its value, dropping to around $576. This marked the commencement of a sustained downturn that eroded over 26% of BNB’s worth. The most dramatic single-day drop occurred on August 5, when the coin plunged by 6.48%, settling at approximately $464. This relentless decline pushed BNB’s Relative Strength Index (RSI) below the oversold threshold of 30.
While BNB has recently rebounded by over 3%, lifting its price to the $478 range and inching its RSI above 30, the broader trend remains bearish.
The price crash has triggered a wave of liquidations, with Coinglass data revealing a staggering $9 million in BNB liquidations. This surge marks the highest liquidation volume since April, highlighting the market’s fragility. Long positions bore the brunt of these liquidations, accounting for over $6.8 million, suggesting many traders were caught off guard by the price drop.
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A negative funding rate of -0.0170% further underscores the bearish sentiment dominating the BNB market. This metric indicates that sellers are in control, making it more expensive to hold long positions than short ones. While the recent price recovery has offered some respite, the persistent negative funding rate suggests that the market remains firmly in the hands of bears.
BNB’s descent into bearish territory raises concerns among investors. Whether this is a temporary setback or the start of a more prolonged downtrend remains to be seen. As the cryptocurrency market continues to exhibit volatility, traders will be closely monitoring BNB’s price action and market indicators for clues about its future direction.
Disclaimer: The information in this article is for general purposes only and does not constitute financial advice. The author’s views are personal and may not reflect the views of Chain Affairs. Before making any investment decisions, you should always conduct your own research. Chain Affairs is not responsible for any financial losses.
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