While selling has slowed over the past 24 hours, Bitcoin and most of the top cryptocurrencies by market cap are still struggling to start a meaningful rally. At the time of writing, the total market cap is sitting at $3.91 trillion, down 0.5%, according to data from CoinGecko. The drop has been triggered by one of the largest crypto liquidation events, in which $1.72 billion worth of longs were forcibly closed on Tuesday.
Meanwhile, the traditional financial instruments continue to perform exceptionally well this week. The S&P 500, for instance, reached a new all-time high on Monday, signaling that investor appetite for equities remained alive. Gold, on the other hand, has just achieved a new all-time high ($3,791) with investors looking to protect themselves as fears of war escalation in the Middle East rise.
While Bitcoin is bleeding, some altcoins, such as BNB, appear immune to market chaos. The native token of the Binance exchange has defied the latest downtrend, rallying 6% in the past seven days to become one of this week’s top performers. So, why is BNB rallying while BTC struggles? Let’s analyze the charts to get answers.
Bitcoin Loses Critical Support
Bitcoin bulls lost control at the $113,345 support at the start of the week, giving the bears a massive advantage. On Tuesday, the coin dipped to $111,583, where the bulls applied pressure, but the daily candle couldn’t close above $113,345, signaling a failed recovery attempt. If BTC doesn’t find aggressive buyers at the current price ($112,763), it may dip toward other key support levels in the coming days.
What Are Technical Indicators Signaling?
Some technical indicators are flashing signs of a bearish move, while others give the bulls hope. For instance, the Squeeze Momentum Indicator suggests that the current price action places BTC in a short-term bearish phase. This is bad news for short-term bulls. Meanwhile, the Average Directional Index (ADX), an indicator used to measure the strength of a bullish or bearish trend, is sitting at 18 points.
Typically, when the reading on ADX is below 20, it’s assumed that Bitcoin is directionless. In other words, it’s in a consolidation phase before the next directional move is established. In such a scenario, most retail traders sit on the fence waiting for the ADX reading to reach 25 before placing any trades.
Relative Strength Index (RSI), on the other hand, is at 39, placing Bitcoin in bearish territory but not oversold, meaning a further drop is possible before a solid recovery rally happens. So, when does the RSI signal an oversold market? Oversold conditions are met when the index falls below 30, where retail traders explore buying opportunities.
Traders’ Bitcoin Price Predictions on Polymarket
According to traders on the Polymarket prediction market, there is a 58% chance that Bitcoin will drop below $110,000 before the end of September. However, the probability that BTC will reach a new all-time high this year is at 83%.
Why BNB is Rally
BNB has shown strength in the past few days, rallying to a new all-time high ($1,078) as the broader market bled. The token is pumping due to the successful launch of the Aster decentralized exchange on the BNB Chain.
Given that BNB is used to pay gas, its demand has risen since Aster went live on September 17th. Aster’s native token itself has witnessed significant gains, up 2,287% in the past seven days.
The technical indicators paint a bullish picture for BNB. For instance, the ADX reading being at 44 signals a strong price trend. This means the bulls are in total control and that BNB could rise further. Moreover, the RSI is at 65, below the overbought zone, which begins at 70. That suggests there is room for BNB’s price to rise higher before traders start booking profits.
Lastly, BNB’s price is above the 50-day and 200-day Exponential Moving Averages (EMAs), signaling that the bullish momentum is strong.
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