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Since March, the price of BNB, formerly known as Binance Coin, has barely dipped below $500, despite the broader cryptocurrency market downturn. Following the heavy losses suffered by major cryptocurrencies, BNB has shown some impressive resistance to price declines, supported by strong demand.
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Despite this strength, the latest BNB Price Prediction CoinCodex still estimates that the coin could rise by 25% and reach $650 by October 10, 2024. Meanwhile, investor sentiment is bearish, with the Fear and Greed Index also at 33, reflecting the uncertainty in the market.
This divergence in expectations raises questions about BNB’s near-term trajectory. While there is potential for long-term growth, caution is warranted in the near term, especially given the coin’s recent volatility and broader market dynamics.
BNB Sideways Movement and Strong Demand
Since March, BNB has been moving in a sideways pattern with significant highs and lows. However, after each drop, BNP The cryptocurrency has surged strongly to over $500, which means there is strong demand for the coin. For example, on September 6, it dropped to $470, but later rebounded to trade at $520 at the time of writing.
This also aligns with the growing expectations of an altcoin season, as the decline in Bitcoin’s dominance tends to boost altcoins like BNB. Investors seem confident that BNB could continue to benefit from this trend in a way that it has historically done when stronger demand for altcoins has been stimulated.
On-chain data: network activity and demand
recently On-chain data Dune Analytics points to some promising and worrying trends in BNB. The number of active addresses on Binance Smart Chain has increased by 6% week-on-week, indicating that more people are interested in joining the network.
However, this increase in active addresses did not reflect a similar increase in transaction volumes, which fell by 1.1% over the week, indicating that the increased participation has not yet translated into strong network activity.
Low network fees also reflect low activity, which could impact the path BNB’s price might take. Certainly, high network usage has historically seen relatively high demand for BNB, and prolonged low activity could limit the coin’s upside potential.
Is a wave of demonstrations looming?
Some analysts believe that the cryptocurrency could be poised for a rally, despite recent bearish sentiment and price volatility, especially once the altcoin season starts heating up. Typically, when Bitcoin’s dominance weakens, it allows other assets to attract market attention and capital, which is where altcoins, especially BNB, tend to perform well.
While the 25% price increase prediction by CoinCodex may be the kind of thing that would indicate that BNB will continue to rise, the short-term outlook for the token remains uncertain.
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While the coin has managed to achieve 47% green days over the past month, the 4.62% price volatility still shows risks. bearish sentiment The concerns prevailing in the markets, coupled with mixed activity in the networks, indicate that investors should be cautious in the near future.
BNB may still be able to hold on and may even grow further. This cryptocurrency is one to watch. But with mixed signals in on-chain data and markets moving cautiously, the risks involved should be considered first before investors venture into this cryptocurrency.
While an upside is certainly possible, the market is not done with the volatility yet, and these short-term fluctuations may still be a problem.
Featured image by Zipmex, chart by TradingView