Binance Coin (BNB) Struggles to Hold Above $650 as Bulls Defend the $637 Level

As the crypto market witnesses a slowdown this week, Binance coin struggles to hold above the $650 mark. Will this short-term weakness lead to a breakdown of the $637 support level and a retest of the 200-day EMA?

Binance Coin (BNB) struggled to sustain its uptrend on Monday, May 15, despite bulls defending the $637 level as the crypto market experienced a slowdown this week.

At the time of writing, Binance coin was trading at $642, remaining above the crucial support level of $637. However, it appears that the BNB coin price action might be testing the 200-day exponential moving average at $615.

On the daily chart, the BNB coin price showed a bullish breakout from a falling channel pattern, with a 4% surge on Monday, May 8. During the rally, Binance Coin reached a peak of $670, encountering strong overhead supply at this level and leading to heavy price rejection.

Following this rally, Binance Coin has shifted into a sideways movement and now risks a pullback to the $637 support level. This short-term struggle is accompanied by a significant drop in the relative strength index (RSI), falling from the overbought zone near 75 to the 14-day simple moving average.

As bullish momentum fades, the likelihood of a deeper correction increases significantly. However, due to the ongoing breakout rally, the 50-day and 200-day exponential moving averages are nearing a golden crossover.

This crossover could trigger a bounce in Binance Coin, presenting an entry opportunity for price action traders. Additionally, the breakout from the falling channel pattern projects a 25% potential rally from the breakout point, targeting the $758 level.

However, a drop below $637 could test the 200-day EMA at $615. If the decline extends below the broken support trendline near $600, the bullish breakout pattern will be invalidated.

Optimism in the Derivatives Market Suggests a BNB Rebound

Despite the short-term pullback, Binance traders remain optimistic about BNB. According to CoinGlass data, 66% of Binance traders currently hold long positions on the BNB coin, pushing the long-to-short ratio to 1.97 and reflecting strong market confidence.

Moreover, a significant portion of traders are setting their stop-loss orders above the 200-day EMA, indicating a belief that any further decline is limited.

DEX Volume and TVL Skyrocket on Binance Smart Chain

Supporting the bullish outlook for BNB, the Binance Smart Chain is witnessing a significant surge in both total value locked (TVL) and decentralized exchange (DEX) volume.

According to DeFiLlama, TVL has risen to $6.17 billion, while 24-hour DEX volume climbed to $2.51 billion as of May 15.

With this increase in DeFi activity, demand for BNB within the ecosystem is likely to grow.

DisClamier: This content is informational and should not be considered financial advice. The views expressed in this article may include the author’s personal opinions and do not reflect The Crypto Basic’s opinion. Readers are encouraged to do thorough research before making any investment decisions. The Crypto Basic will not be liable for any financial losses.