Why is BNB Price Up Today?
Speculation of a settlement between Binance and the US Justice Department could be a reason why BNB price is up today. The post Why is BNB Price Up Today? appeared first on CoinChapter.
NOIDA (CoinChapter.com) — Binance Coin (BNB) price is up today after breaking out of its short consolidation phase with an 8.2% spike on Feb. 21. The exchange’s token continued its uptrend on Feb. 22, but bears have started to book profits, pushing back gains.
One reason why BNB price is up on Feb. 22 could be the short squeeze due to the token’s recent price spike.
The funding rate for BNB futures plummeted on Feb. 21, suggesting that bearish traders have to pay the bullish ones a fee to maintain their short positions. However, shorts led the liquidations since Feb. 21, totaling more than $2.2 million compared to $0.73 million worth of liquidations in long positions.
Negative funding rates, combined with short liquidations, where short positions are forcibly closed due to insufficient margin, can lead to a short squeeze. The phenomenon often results in a rapid price increase, as short sellers buy back assets to cover their positions, further driving up the price.
New Token Launch Could Be Why BNB Price Is Up Today
Another reason why BNB price is up on Feb. 22 could be the launch of a new token on the Binance Launchpool. Portal, a cross-chain gaming platform, launched as the 47th project on Binance Launchpool.
Users interested in farming the PORTAL token will need to stake BNB and FDUSD tokens for seven days, and farming for the token would begin on Feb. 22.
PORTAL has a total supply of 1 billion tokens, of which Binance Launchpool will award 50 million to the users farming the token. The exchange will list the token on Feb. 29 with PORTAL/BTC, PORTAL/USDT, PORTAL/BNB, PORTAL/FDUSD and PORTAL/TRY trading pairs.
Staking a token can be a bullish cue for a token, as it reduces its available supply in the market. If the demand remains the same, BNB price could appreciate further in the coming days.
Bears Push BNB Bull Run Back
BNB price’s bull run stopped after bears started to book profits on Feb. 22, with the token paring most of its gains after rising nearly 3.6% to a daily high near $387.
Another bearish cue for the token comes from the momentum indicator RSI, which measures an asset’s price movements to identify overbought or oversold conditions. BNB’s RSI is overbought, with a score of 76.37 on the daily charts.
Traders often consider an overbought RSI level a bearish signal since the occurrence usually precedes a bearish reversal or consolidation phase for the underlying token.
Hence, the Binance token risks a drop to the support near $350, at which point short traders might enter the market. A break below immediate support might confirm BNB price’s downtrend, prompting bulls to defend the support near $329.
On the other hand, BNB price could up after a period of consolidation to reach the resistance near $399. Moreover, flipping the immediate resistance might help the Binance token price target the resistance near $435 before correcting.
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