Binance Coin (BNB) has recently faced turbulence in its price due to the SEC’s lawsuit against Binance.US. However, there are signs of a potential turnaround. Is it too late to buy Binance Coin?
The SEC’s Lawsuit Against Binance
Binance, one of the leading cryptocurrency exchanges, has become a prominent player in the Securities and Exchange Commission’s (SEC) crusade against the crypto industry. This legal battle, reminiscent of the Ripple case, is growing increasingly complex.
The latest development in the courtroom involves a dispute over the 220 documents provided by Binance as part of the expedited discovery process. The SEC alleges that these documents are insufficient, and there are also alleged issues with access to witnesses.
Amid this legal chaos, Binance.US has experienced a significant drop in trading volume, with just $5.09 million in trading volume on September 16. This decline followed the suspension of nearly 100 trading pairs.
BNB Price Analysis
As the legal battle unfolds, the price of Binance Coin appears to be staging a comeback. BNB is currently trading at $218.9, reflecting a 24-hour change of +1.11%. This recovery comes after a sharp 33.3% decline following the news of the SEC lawsuit, which caused the price to plummet from strong support above $300 to an immediate drop to $225.
Over the past three months, BNB’s price has been trading in a narrow range between $200 and $250, closely tracking the 20-day moving average (20DMA) as it attempts to turn resistance into support.
However, there are signs of technical improvement this week. The formation of a double-bottomed support pattern on August 22 and September 12 has positioned the price for an 8.46% bounce off the lower trendline support in the past week.
The recovery has been supported by the reclamation of the 20DMA, which now serves as a strong foundation for BNB to break out of the lower trading channel. Nevertheless, the rising Relative Strength Index (RSI) at 52.81 suggests the possibility of consolidation or retracement, potentially putting a pause on the upward momentum.
On the other hand, the Moving Average Convergence Divergence (MACD) is displaying strong bullish divergence, driven by the reclaimed 20DMA, which has pushed the indicator up to 1.2.
Overall, Binance Coin appears to be in a robust position with double-bottomed support, a reclaimed 20DMA, and bullish indicators, despite the ongoing regulatory challenges.
- Upside potential: BNB could target a return to $250, representing a potential +14.31% move.
- Downside risk: A possible drop to $205, which would be a -6.26% decrease.
This risk-reward ratio of 2.28 indicates a favorable entry point for those considering buying Binance Coin in the short term.
However, while Binance continues its battle with the hostile US regulator, savvy investors are exploring opportunities with an emerging AI analytics platform. This platform offers retail traders the chance to access market-beating crypto alpha.
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