BNB pared a huge portion of the losses it faced earlier this week amid a broader recovery across the top cryptocurrency assets.
The third’s largest digital asset, which powers the Binance ecosystem as an in-house token, surged by as much as 21.95 percent during the Asian session Wednesday, establishing an intraday high of $282.76 ahead of the London opening bell.
BNB shed some part of its gains into the European session on profit-taking sentiment but retained its intraday bullish bias. A weaker sell-off at its sessional top pointed to the possibilities of a continued upside trend. Nonetheless, BNB was looking weaker during the ongoing US session.
The token’s zigzag moves followed a parabolic upside move that saw its value surging by 828 percent in 2021. For traders, BNB’s price appeared too overstretched that required a neutralized downside correction. The cryptocurrency did so by falling as much as 46.83 percent to $184.99 after setting up a record high at $347.98.
Ethereum vs. Binance Smart Chain
For a larger part during its moves, BNB was tailing Bitcoin’s trend. The token’s rise on Wednesday also appeared after its top rival posted recovery moves against the US dollar.
But BNB’s growth was massive compared to Bitcoin. Much of it had to with Binance Smart Chain‘s emergence as a contender to Ethereum. In retrospect, traders increased their bids on BNB after transaction fees on the Ethereum network grew higher, making it unfeasible for the decentralized apps to operate atop it.
In turn, it led to speculations that BSC would replace Ethereum to become the world’s leading blockchain with smart contract and staking capabilities. Binance CEO Chanpeng Zhao added fuel to speculations by openly inviting Ethereum-based decentralized finance projects onto BSC.
The transaction volume on BSC surpassed that on the Ethereum blockchain in February.
BNB Technical Setup
With strong fundamentals, BNB looks poised to grow further. Meanwhile, the technicals forecast the same.
The token is now trading lower inside a parallel descending channel. Looking broadly, it appears like a Bull Flag, a bullish continuation pattern that occurs during an uptrend and signals a breakout move to the upside.
BNB/USD expects to undergo a breakout above the flag pattern. The pair could therefore rise by as much as the previous uptrend’s height, aka “flagpole.” That puts BNB en route to $370, a new record high.