Binance’s BNB (BNB-USD) coin had a ripping third quarter in 2020. Coin price went from just over $16 to now over $28, as larger coins like Bitcoin (BTC-USD) and Ethereum (ETH-USD) remained flat. A lot of positive developments have also taken place on the Binance Exchange as the team deepens the product offering available on the world’s largest exchange by trading volume. In the light of these, what does the 4th quarter hold for the BNB-USD pair?

Fundamental Analysis

Binance Coin continues to be the beneficiary of several integrations and initiatives of the Binance exchange. In 2020, one of the initiatives undertaken by Binance has been the Binance Smart Chain, which allows several blockchain applications to be hosted. DeFi is hot right now, and many projects have been listed on Binance Smart Chain. Recently, Trust Wallet has completed the requirements to be listed on the Binance Smart Chain.

Speaking of new initiatives on Binance, the Binance team has just introduced a new product known as Binance Earn. Binance Earn is a new landing page that has pooled together the various passive earning products on Binance into a single page, making it easier for users on the various Binance passive earning sites to manage their portfolios. The single portal now incorporates the Launchpool, the Flexible Savings, Locked Savings, and Asset Management (Binance Liquid Swap & Dual Savings) products.

This is in addition to the various giveaways that are periodically organized by the company. It recently celebrated the 1-year anniversary of the Binance Futures launch with a $1,000 Bitcoin giveaway. These initiatives continue to drive investor interest in the Binance Coin.

Most of these promos on Binance require that participants acquire the Binance Coin, which is why this token continues to generate demand. Coupled with this demand is the fact that the US dollar had a 3rd quarter to forget. The BNB-USD has gained 34.46%, 12%, and 26.4% respectively in the months that made up the 3rd quarter of 2020.

Technical Analysis

The technical analysis of the BNB-USD pair starts on the weekly chart, where we can see that price action has followed the typical pattern of the impulse waves of an uptrend. So far, the 1-2-3-4 wave pattern has been completed, with wave 5 taking off from the 25.8437209 support line. Price needs to establish a higher high above 33.1005119 in order to continue the uptrend. Failure to establish this higher high stalls the progress of the uptrend, and may even signal its reversal.

BNB-USD Weekly Chart: October 3, 2020

The daily chart shows that the recent price pattern in the short term has formed a symmetrical triangle, with the 5th impulse wave that was seen on the weekly chart shown as the bullish price action on the last two days that now challenges the upper border of the triangle. The question for buyers and sellers is whether this bullish price move will break out of the triangle (in keeping with the technical expectation) or whether this border will force a decline that invalidates this expectation.

BNB-USD Daily Chart: October 3, 2020

A look at the daily chart shows that the price maintained a very slow uptrend march from April 2020 to August 2020, which was when price entered into a steep uptrend to form the base of the triangle. The triangle is a continuation pattern. Therefore, the technical expectation is for the price to break out of the triangle to the upside and continue its ascent. If this expectation is fulfilled, the BNB-USD pair will target the previous high at 33.10005119. This is the initial target for the breakout move. If price clears this high, then the uptrend continues and the next target for price action would be the 37.3544928 price level. Further ascent allows 42.8596445 (17 June 2019 highs) to come into the picture.

Conversely, it is also possible that the symmetrical triangle’s upper border could resist the price action and lead to a price decline. About a fifth of symmetrical triangles does not lead to a continuation of the trend. If this triangle belongs to the 20% that leads to a trend reversal, then we can expect the price to drop below the triangle, targeting the 19.587866 support. However, this price move must break down the immediate support at 25.8437209 to become a reality. Further decline targets 17.7111103, with 14.4580661 remaining relevant to the picture, as this price level served as a major support for the greater part of 2020.

Market Sentiment

  • Long term: Bullish
  • Medium term: Bullish
  • Short term: neutral

The long-term trend, as well as the medium-term trends, remains bullish, as price is in the 5th impulse wave in the bullish 1-2-3-4-5 Elliot wave pattern. In the short term, price action retains a neutral sentiment as it continues to consolidate within the triangle pattern. Sentiment on this time frame will only change if price breaks the triangle.

Did you know that Bitcoin is up +83% since 1/1/20? As world markets plummet due to COVID, investors are turning to crypto now more than ever.

We provide news, research, technical analysis and more at the Coin Agora on all things crypto!

Sign up now and get instant access to our Pick Portfolio – where three of our picks are up more than 180% in the last 12 months.

Disclosure: I am/we are long BNB-USD. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.