BNB, the native token of BNB Chain, has initiated a recovery on January 26th, experiencing a 3% increase to surpass the $300 mark. Although BNB is still relatively weak, the ongoing recovery is supported by the growing activity within the network.
A significant portion of the value of the BNB token stems from reduced trading fees and exclusive launchpad offers and services provided by Binance. Binance recently introduced a “dual investment” product that could further boost BNB’s trading volumes, which have already exceeded $998 million in the past 24 hours.
One way to gauge the strength of a blockchain ecosystem is by comparing its performance to competing chains. When observing DApp volumes, Ethereum and its layer-2 scaling solutions remain dominant, accumulating over $31.73 billion in the past seven days. Ethereum’s nonfungible token (NFT) volume alone reached $226 million. In comparison, BNB Chain recorded $3.82 billion in DApp volumes, with its NFT volume experiencing an 11% surge to reach $864.93 million.
However, when considering active unique addresses (UAW), BNB Chain leads the way with 2 million UAWs, surpassing Ethereum’s 359,380.
From a relative standpoint, BNB Chain has witnessed a 6.4% growth in the number of addresses engaging with DApps over the past seven days. This, along with the increasing transaction volume, could explain the rising total value locked (TVL). Data from DefiLlama indicates that BNB Chain’s TVL has steadily increased since mid-December 2023, reaching a peak of $3.73 billion on January 18th. Although this metric has slightly declined in recent days, it started to pick up again on January 25th, indicating a growing level of trust from users in the blockchain.
Looking at the charts, BNB’s price pulled back after reaching an eight-month high of $340 on December 28th, 2023, as sellers took profits and the broader crypto market underwent a correction. However, a bullish flag pattern can be observed on the daily chart, suggesting a potential continuation of the uptrend.
BNB bulls may face resistance at the upper boundary of the flag, which is located at $316. A daily candlestick close above this level could signal a breakout from the chart formation, potentially leading to a rise to $450. This would represent a 48% increase from the current price.
Technical indicators such as the 50-day exponential moving average (EMA), 100-day EMA, 200-day EMA, and the relative strength index (RSI) all point upwards, indicating that the market conditions are still favorable for the upside. The increase in price strength from 40 to 50 suggests that the bulls are buying during dips.
On the other hand, the bears could push the price lower, with the lower limit of the flag at $282 serving as the initial line of defense. Additional support levels may come into play at the 100-day EMA at $271 and the major support level at $250.
It is important to note that this article does not provide investment advice or recommendations. Readers should always conduct their own research and analysis before making any investment or trading decisions.