Binance continues to trend lower and has just bounced off the top of a descending channel on its 4-hour time frame. From here, it could set its sights on the next downside targets marked by the Fibonacci extension tool.
The 38.2% extension just close by is at 0.00158 then the 50% extension lines up with the mid-channel area of interest at 0.00151. Stronger selling pressure could take it down to the 61.8% extension at 0.00143 or the 78.6% extension near the channel support at 0.00132. The full extension is located at 0.00118.
The 100 SMA is below the longer-term 200 SMA to confirm that the path of least resistance is to the downside. In other words, the downtrend is more likely to resume than to reverse. The gap between the two is significantly wide to indicate that there’s no imminent threat of a crossover, and the short-term MA held as dynamic resistance.
RSI is also pointing down to indicate that sellers are in control of the game and could continue to push Binance lower. Stochastic is also heading south but closing in on oversold levels to reflect exhaustion among sellers. Turning back up could bring buyers in again.
Most cryptocurrencies have been in consolidation mode for the past few days, with Binance returning some of its gains to bitcoin when it rebounded last week. However, bitcoin is also treading sideways for now as it awaits the next set of market catalysts.
So far the mood is still somewhat positive, as the industry draws support from institutional interest and regulatory developments. Threats of stricter regulation or a major crackdown in any of the large cryptocurrency markets could bring in some jitters, along with security incidents or exchange hacks.
The latter, in particular, tends to have a strong bearish impact on Binance since it is an exchange-based token after all. For now, it appears to be taking cues from bitcoin on the lack of specific developments.