BNB ‘Rektember’ Alert! Binance Coin Can Drop 30% This Month

Historically, September has been a terrible month for cryptocurrencies, primarily because it has been the same for stocks, bonds, and gold. That somewhat puts Binance’s native coin, BNB (BNB), at risk of declining in the coming weeks, with a technical pattern furthering the downside outlook.

BNB is Forming a ‘Double Top’ Pattern

BNB’s ongoing price moves have formed what appears to be a “double top” pattern, a potential bearish reversal setup, identified by two distinct peaks at approximately the same price level—first in mid-July 2024 and then again in late August 2024— around the $599.50 level.

This double-top formation suggests BNB faced strong resistance at this price level and could not break above it twice, indicating potential exhaustion in the bullish momentum.

Following the second top, BNB’s price dropped below the 50-day EMA at $546.40, signaling increased selling pressure. The chart shows that BNB tested the 200-day EMA at nearly $520, with a decisive break likely confirming a bearish trend.

The key support to watch is $465.50, a level connecting the lows from May and June 2024. A breakdown could trigger a deeper sell-off, targeting $362.10, a level derived after adding the height of the double-top pattern to the potential breakout level.

In other words, BNB’s price is at risk of declining by over 30% in September.

BNB’s daily relative strength index (RSI) also signals weakening momentum. It has been trending downward and was hovering below the neutral 50 mark as of Sept. 3, suggesting that bears are gaining control. If the RSI continues to decline, it could further confirm the bearish bias in the market.

BNB ‘Rektember’ Meets Fed Rate Cut Hopes

Since its launch in 2017, BNB has witnessed only two bullish September months. On the other hand, the other September months have posted losses—from minor to extreme, as shown below.

In September 2024, BNB traders should also brace for potential turbulence as uncertainties loom, including a pivotal U.S. jobs report that could influence the Federal Reserve’s future interest rate decisions.

With the broader crypto market still up 175% from its 2023 lows and Treasuries marking their longest monthly winning streak in three years, markets appear vulnerable to unexpected data or surprises from a closely contested U.S. presidential race.

Nonetheless, bond trades see a 61% probability of a 25 basis point rate cut in September, up from 26% a month ago. Looser rates could increase the market’s appetite for riskier assets like BNB, invalidating the double-top pattern setup altogether.