BNB’s price standout performance today lacks a clear fundamental catalyst and is instead driven by macroeconomic factors and technical indicators
On June 5, BNB $699 price established a new record high at around $716 after rising 4.50% intraday and by over 14% in the last 24 hours. In doing so, the Binance native cryptocurrency outperformed the broader crypto market, which rose 3.5% in the last 24 hours.
There isn’t any clear fundamental indicator behind BNB’s price outperformance today compared to the rest of the crypto market. Instead, the cryptocurrency is drawing its bullish cues from macroeconomic and technical indicators.
Declining bond yields boost BNB buying
The duration of BNB and, in turn, the crypto market’s recent gains coincide with declining U.S. bond yields.
For instance, the benchmark U.S. 10-year Treasury note yield (US10Y) declined to 4.332% on June 4 from 4.63% five days ago. The same period witnessed BNB’s price rally by over 20.75%, showing a clear negative correlation with the bond yields.
Treasury yields declined on the signs of the Federal Reserve’s preferred inflation gauge remaining steady, coupled with weaker-than-expected data on manufacturing and consumer spending. They fell even further on June 4 after an unexpected decrease in U.S. job openings was reported.
Signs of slowing inflation have prompted bond traders to advance their expectations for the Federal Reserve’s first full 25 basis-point rate cut to November from December.
Declining interest rates reduce the opportunity cost of holding safer investment assets such as cash and bonds.
As a result, they lead to an increase in appetite for riskier assets such as crypto and stocks, a sentiment that has helped BNB—the fourth-largest cryptocurrency by market cap—rise today.
BNB enters ascending triangle breakout stage
From a technical standpoint, today’s gains in BNB’s price signify the breakout phase of its current ascending triangle pattern, triggered by a support confluence comprising the 20-day (purple) and the 50-day (red) exponential moving averages (EMA).
For the unversed: An ascending triangle forms when the price fluctuates between rising trendline support and horizontal trendline resistance. In an uptrend, the pattern resolves after the price breaks above the resistance and rises by as much as the triangle’s maximum height.
As of June 5, BNB’s price was breaking above the triangle’s resistance, eyeing a further run-up toward the upside target at around $800, up about 15% from the current price levels.
On the flip side, BNB’s daily relative strength index (RSI) has entered its overbought area above 70, increasing the likelihood of a price correction or consolidation in June.
That coincides with the price testing its 1.618 Fibonacci retracement line at around $708 as resistance, furthering a correction outlook toward the 1.00 Fib retracement line at approximately $630, down by about 11.50% from the current price levels, in June.
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