The Binance Coin price has entered a correction this month after plunging by over 10% from its highest level of the year. BNB token was trading at $760 today, August 6, with technicals pointing to an eventual rebound, potentially to $1,000 later this year.
Binance Coin Price Crashes as Key Metrics Deteriorate
The ongoing Binance Coin price crash has coincided with the ongoing crypto market plunge. Bitcoin price has dropped by over 7% from its highest point this year, while most altcoins are in a deep bear market.
BNB price has also plunged as some parts of its metrics have plunged recently. For example, StakingRewards data shows that investors have reduced their staked tokens by 1 million BNB tokens worth almost $1 billion. This retreat has pushed the staking ratio down to 21.01%.
Staking outflows are highly bearish because they mean that some long-term holders are starting to book profits after it surged to a record high.
More data reveals that the number of transactions in the BNB Smart Chain (BSC) has plunged. Transactions in the network fell by 50% in the last 30 days to over 377 million, leading to a 17% drop in fees to $10.50 million.
Falling transactions in a network are often a red flag, as it sends a message that users are no longer interacting with it as they did. However, this deterioration can be temporary, which can lead to a rebound.
BSC Stablecoin and DEX Growth Have Stalled
Further numbers show that BSC’s stablecoin growth has hit a wall. While the stablecoin supply in the network has jumped by 4.2% in the last 30 days, the number of stablecoin addresses has plunged by nearly 32% to 14.1 million.
Similarly, as the chart below shows, the number of stablecoin addresses in the BSC network has dropped by 45% to 420 million. The adjusted transaction volume has dropped by 51% to $239 billion.
A falling stablecoin growth trajectory is bearish for a cryptocurrency, especially after Donald Trump signed the GENIUS Act into law last month.
More data on the decentralized exchange industry also explains why the BNB price has dropped recently. DeFi Llama data shows that the BSC network handled $1.79 billion in transactions in the last 24 hours, lower than Ethereum’s $2.82 billion and Solana’s $2.3 billion.
Its monthly transactions were $68.37 billion, lower than Ethereum’s and Solana’s $95 billion and $83 billion. This is a major deterioration as BSC was the most active chain in the DEX industry a few weeks ago.
Can the BNB Price Jump to $1,000?
So, can the Binance Coin price rebound and hit $1,000 as analysts predicted? The daily timeframe chart shows that the coin has bullish catalysts despite the recent retreat.
BNB price sits above the 50-day and 100-day Exponential Moving Averages (EMA), which have supported it since June.
Most importantly, the coin has formed the highly bullish cup-and-handle pattern whose depth is about 38%. The ongoing BNB price dip is part of the formation of the handle section of this pattern.
Therefore, it is likely that the coin will bounce back now that it has tumbled to the Major S/R pivot point of the Murrey Math Lines tool. If this happens, the initial target will be at $860, the highest point since July 28, which is about 13% above the current level.
A surge above that level will point to more upside to $1,000. Over time, it may jup and hit the cup-and-handle target of $1,095.
Summary
The BNB price has retraced in the past two weeks as the recent bull run took a breather and key metrics deteriorated. These metrics include its stablecoin supply and decentralized exchange volume. On the positive side, technical indicators point to an eventual rebound, potentially to the resistance level at $1,000.
Also Read: Sui Surpasses Solana in Stablecoin Transfers With Record $224B in July
