Binance Coin (BNB) has been holding above $600 since November 8, but is struggling to retest $700 or get closer to its all-time high.
This stagnation has left many BNB holders disappointed, raising the question: will BNB be able to reach a new peak?
Binance coin experiences low volatility and falling interest
Although BNB is trading around $612, the volatility around it seems to be the reason why it remains above $600 but has yet to make another significant price increase.
When an asset is described as volatile, it means that its price experiences significant fluctuations over a short period of time. High volatility signals greater risk due to unpredictable price movements, but also provides the opportunity for higher profits.
Therefore, if buying pressure increases during times of high volatility, the price of the asset may rise significantly. If this volatility occurs during a time of high selling pressure, the price could drop significantly.
According to Santiment, BNB’s one-day volatility has decreased from its recent peak, indicating less price volatility. This drop in volatility could prevent BNB from achieving a significant breakout above the $600 mark as the market may lack the momentum needed to make a significant move.
Additionally, open interest (OI), a metric that tracks the level of speculative activity around a cryptocurrency, declined. High OI typically signals increased capital inflows into the contract, often indicating strong buying pressure that can push prices higher.
Conversely, a drop in OI reflects decreased liquidity in the market, often associated with selling pressure and potential price declines. For BNB, OI has remained relatively stable since November 19, indicating that traders are hesitant to introduce additional liquidity or enter into new contracts.
In addition, OI is noticeably lower at $532.08 million than on November 14. The lack of speculative activity indicates weakening market momentum, increasing the likelihood that the BNB price will struggle to break above the $600 threshold.
BNB price forecast: likely to fall to $551
Similar to open interest, the BNB price has followed a steady trend since July, repeatedly encountering resistance around $612. This indicates the bears are persistently trying to prevent the cryptocurrency from challenging its all-time high of $724.
Currently, as BNB is trading near the same resistance level, a decline is possible. Historical patterns suggest that if the coin fails to breakout, it could return to $551 as it was before.
Similar to open interest, the BNB price has followed a steady trend since July, repeatedly encountering resistance around $612. This indicates bears are persistently trying to prevent the cryptocurrency from challenging its all-time high of $724.
However, a surge in volatility coupled with strong buying pressure could cast doubt on this forecast. In such a scenario, BNB may not stop above $600, but also rise to $660 or even retest the $724 high.
