Key takeaways:
BNB (BNB) has failed to extend its record rally, facing rejection near the $1,350 level twice in the past week, a pattern that raises the odds of a pullback in October.
Double top setup raises 30% BNB correction risks
BNB’s daily chart reveals a classic double top formation near the $1,350-$1,375 area, signaling potential trend exhaustion after a 95% year-to-date rally.
The two peaks, shown as Top 1 and Top 2 below, mark failed breakout attempts, with the neckline support sitting around $1,100. A decisive close below this neckline could validate the double top pattern.
In that case, BNB faces risks of declining by as much as the pattern’s maximum height, thus bringing the downside target to around $835. This implies a roughly 30% correction from current levels by the end of October or early November.
Momentum indicators are echoing caution, including the daily relative strength index (RSI), which has entered a correction stage after slipping from its overbought territory above 70.
Also, BNB’s Moving Average Convergence Divergence (MACD) lines show a bearish crossover. It further indicates that the market’s buying strength is fading, and bearish momentum could strengthen if BNB slips under the $1,100 support.
Binance’s $21.75 billion outflows raise risks for BNB
Binance witnessed the highest $21.75 billion in user withdrawals from a centralized exchange over the past week, including $4.1 billion in outflows within a day, according to data resource CoinGlass.
The exodus comes in the aftermath of the Oct. 10 liquidation crisis, when Binance’s internal oracles mispriced key collateral assets, triggering a cascade of margin calls.
As of Wednesday, Binance’s daily outflows had eased, but the seven-day balance remains down by $3.69 billion.
Some analysts now suspect that the $20 billion liquidation event crash was a targeted exploit on Binance’s Unified Account margin system.
Dr. Martin Hiesboeck, head of research at Uphold, said in a Monday post that attackers exploited a flaw in Binance’s margin system, causing losses of $500 million–$1 billion.
He dubbed the event “Luna 2.”
Related: Exclusively obtained orderbook data reveals details about USDE crash
The accusations coincided with BNB’s rejections in the $1,350-1,375 area on Monday, reflecting shaken confidence despite Binance’s $400 million relief pledge announcement.
There’s still hope for BNB bulls
BNB still trades above its key exponential moving average (EMA) supports, including the 20-day EMA (the green wave) near $1,155 and the 50-day EMA (the red wave) at around 1,042.
A rebound from these EMAs, establishing them as new support, could invalidate the double top pattern. In this case, the price discovery zone sits just above the $1,350 level, which remains in play in October.
This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.
