Binance Coin (BNB) has weakened more than 25% after the FTX cryptocurrency exchange filed Chapter 11 for bankruptcy and ended up with a huge liquidity gap of over $8 billion. The risk of further decline for BNB is still not over, especially after the latest news that the U.S. central bank might stick to a longer rate-hike cycle. Jason Pride, chief investment officer for private wealth at Glenmede in Philadelphia, said:
“Expectations are beginning to unravel a little bit as the market realizes that the Fed may have to maintain rates at a higher level for longer than it had hoped, and this is placing a more downward pressure on the markets.”
The next Federal Reserve meeting is scheduled for December 13, and it is still not sure if the Federal Reserve will take a less aggressive stance in its interest rate hikes. Expectations are that Fed policymakers will probably raise interest rates by 50 basis points, but the main question still remains how much time Fed will need to hold policy at a restrictive level in order to control inflation.
The U.S. economy faces recession risk that could dent corporate earnings, and because of this, the outlook for risk appetite in the near term is not looking good. At the same time, the cryptocurrency market faces a deep trust crisis as the collapse of the FTX created unprecedented market turmoil that could last for several more months.
Binance Coin (BNB) Technical Analysis
The price of Binance Coin (BNB) has weakened from $397.58 to $240.77 since November 08, and the current price stands at $283.27. The price has also moved below the 10-day moving average, indicating that this cryptocurrency could fall even more in the upcoming days.
Binance Coin (BNB) might have a hard time holding above the current support level, which stands at $250, and a break below this level would indicate that we could see BNB at $240 or even below. The upside potential remains limited for now; still, if the price of Binance Coin (BNB) jumps above $300, the next target could be $330.
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Concluding Facts On Binance Coin (BNB)
According to analysts, the U.S. central bank might stick to a longer rate-hike cycle which could push the U.S. economy into recession. Binance Coin (BNB) might have a hard time holding above the current support level, which stands at $250, and a break below this level would indicate that we could see BNB at $240 or even below.
See Related: Binance Coin (BNB) Definition
