Bitcoin (BTC) has dropped below $7900 sending signals that it could be headed lower. This has created fears that the recent rally may have failed, and that the market could retest its recent lows. So what to do now? To make a decision on what to do next, all one has to do is look at crypto charts in the last 7 months.
All through the bear market, there is one crypto that has performed extremely well, and that’s Binance coin (BNB). This coin has built a reputation as a safe haven in times of crypto uncertainty. While everything else lost value since the bear market started in January, Binance coin has actually doubled in value.
Even in the current market scenario, Binance coin looks set to uphold its legacy as a safety crypto. In the last few hours, bitcoin has dropped by over 5%, and has broken below $7800. In that same period, Binance coin is up by over 2%, and looks set to edge higher, going by its increased trading volumes.
Therefore, if bitcoin continues to drop and falls below $7500, which is a significant support level in the day charts, then it would make sense to pivot towards Binance coin. That’s because a break below $7500 would draw in short-sellers who would be looking to make money on the downside. Short sellers at this point are supported by the fact the whole ETF issue has created lots of uncertainty in the market. After the Winklevoss twins ETF application was rejected, the market is not sure whether the CBOE one will get approved.
So what makes Binance coin tick, as an investment at this point in time? Well, Binance coin is backed by one of the world’s largest crypto exchanges. The exchange also distributes some of their profits to Binance coin holders, and the profitability of this exchange has been rising. This gives Binance coin a certain element of stability that is lacking in most other cryptos. Simply put, there is something solid, and valuable backing it.
Binance coin is also supported by market psychology. The crypto markets like other financial markets are driven by psychological factors. In this case, investors are uncertain on the direction of Bitcoin (BTC), as well as that of their favorite altcoins. Naturally, the first thing they rush to do is to find safety. This explains the spike in USDT volumes in intra-day trading. However, USDT and other stable coins don’t offer growth, and the next logical step is to look for bear-resistant cryptos, and that’s where Binance coin (BNB) comes into the picture.
Therefore, if Bitcoin turns bearish and drops further, chances are that Binance coin (BNB) could rise to $20 in the near future. A volumes surge could give it a huge price spike, a spike, which in turn would draw in more investors, further pumping up the price. However, Binance coin has not been performing well in the recent bitcoin rally. As such, it would also make sense to watch the price of bitcoin (BTC) even as one takes positions in Binance coin (BNB).