1. The rebound logic is still in play: reduced circulation + on-chain activity + spot accumulation
Three days ago, Binance Coin (BNB), which has a market capitalization consistently among the top five cryptocurrencies (currently about 43 billion USD), just touched a historic high of 949 USD before facing selling pressure and dropping to a low of 911 USD; as of the time of writing, its daily chart has only slightly decreased by 0.27%, reporting at 928 USD, showing a certain degree of resistance to decline. Despite the short-term pullback, cryptocurrency market analysts remain optimistic - the CryptoQuant team pointed out in its latest report that, aside from Bitcoin's tightening supply supporting upward movement, BNB's own fundamental improvements are more noteworthy, which is also the core logic behind its rebound.
Circulating supply hits a 20-month low, deflationary pressure continues.
According to real-time data from CryptoQuant, the current circulating supply of BNB has dropped to 139,187,000 pieces, the lowest level since January 2023 (in January 2023, it reached 134 million pieces when the market was in the recovery stage after a bear market, with BNB price ranging approximately from 280 to 320 USD). This reduction in supply is not coincidental, but a continuation of the long-term trend since mid-2024: Binance has implemented a 'destruction to 100 million circulating supply' mechanism, with a cumulative destruction of 62.8 million BNB to date, averaging 1.5 million BNB destroyed per quarter (the destruction funds mainly come from a specific proportion of Binance's quarterly operating profit, publicly executed through on-chain smart contracts to ensure transparency).
The direct impact of continuous destruction is an increase in scarcity: if market demand remains stable or grows, the reduction in circulating supply will lower potential selling pressure, forming a beneficial pattern of 'supply-demand mismatch' — this is also one of the important drivers for BNB to break through the 600 USD range to above 900 USD in 2024.
On-chain ecosystem activity is rising, with organic demand support evident.
While supply is shrinking, on-chain activity of BNB Chain is simultaneously heating up. The latest data from Dune Analytics shows that the number of active users of BNB per week reached 10.7 million, a month-on-month increase of 1.2%, with about 30% of users coming from DeFi ecosystem interactions (such as swap operations on platforms like PancakeSwap, liquidity mining), and another 20% involving NFT market transactions (such as LooksRare BNB version, TreasureDAO's asset minting); during the same period, the number of blockchain transactions increased by 13.6% month-on-month, reaching 96.83 million transactions, averaging 13 million transactions per day, which is an 18.2% increase from last month's daily average of 11 million transactions.
Generally speaking, the simultaneous increase in 'active users + number of transactions' means that the on-chain ecosystem does not rely on short-term speculation, but has real participation — this organic demand will create price support, often indicating a medium-term upward trend.
The spot market is buying on dips, and the signal for funds 'leaving the market to hold coins' is significant.
It is worth noting that during the pullback period from the historical high, BNB exhibited a 'buying on dips' characteristic in the spot market. Coinalyze data shows that as of the time of writing, the spot buying volume of BNB reached 21,380 pieces, with a selling volume of 18,250 pieces, a buy-sell difference of 3,130 pieces, equivalent to about 2.9 million USD in net buying; while the fund flow from the exchange further confirms this trend — CoinGlass data shows that in the past three days, BNB's spot net flow was -10.18 million USD, and as of the time of writing, the net flow was -6.27 million USD (negative net flow means funds are flowing out of the exchange), indicating that investors prefer to transfer BNB to personal wallets for long-term holding rather than selling on the exchange, and the accumulation sentiment in the spot market is strong.
2. Concerns about the upward trend: Technical indicators have issued bearish signals, with 883 USD as a key support.
Although the fundamentals remain beneficial, the short-term upward momentum of BNB has shown signs of fatigue. AMBCrypto's technical analysis found that two key indicators have shown a bearish turn, which may extend the pullback cycle.
DMI forms a bearish crossover, upward momentum weakens.
The Directional Movement Index (DMI) is composed of +DI (Positive Directional Indicator), -DI (Negative Directional Indicator), and ADX (Average Directional Index), and the current overall DMI value has dropped to 27, primarily because +DI has fallen from 35 to 22, while -DI has risen from 18 to 27, forming a bearish crossover of '-DI crossing above +DI' — this signal indicates that the upward force in the market is dissipating, while the downward force is gradually strengthening, putting pressure on the short-term trend to reverse.
The random RSI has turned downward, profit-taking after being overbought.
The random RSI indicator has currently dropped to 79, although it is still close to the overbought range (above 80), it has fallen from the previous high of 85 +, and there are clear signs of turning downward. This means that short-term investors who entered at high levels earlier are starting to take profits, increasing selling pressure; if buying pressure does not catch up in time, the pullback may widen.
Support and resistance levels are clear: 883 USD vs 944 USD.
If the short-term pullback continues, 883 USD will become a key support level — this position not only serves as the high point of the consolidation platform during the upward process since October 2024, but also coincides with the 20-day moving average. Historical data shows that BNB has received effective support near the 20-day moving average during the past three pullbacks; if this position can be maintained, it is expected to re-challenge 944 USD (the key retracement point of the previous high of 949 USD, and also the intersection of the 5-day and 10-day moving averages). Conversely, if the 883 USD support fails, the next support level will look towards 850 USD (50-day moving average position).
3. Conclusion: Short-term volatility, medium-term still has upward space.
In summary, BNB is currently in a balanced state of 'fundamental benefits + short-term technical pressure': the reduction in circulating supply, on-chain activity, and spot accumulation form the basis for medium-term upward movement, but the bearish signals from DMI and random RSI may trigger short-term volatility, with 944 USD resistance and 883 USD support becoming the core range for judging short-term trends. If spot buying continues to enter, and technical indicators return to the bullish range, BNB is expected to break through the historical high; if the pullback deepens, the vicinity of 883 USD may become an opportunity point for medium to long-term layout.
Follow Ming Ge, join Ming Ge's top team, where there are strategies and companionship, let's fight side by side and steadily win back your profits!
