BNB reached a new all-time high of $1,375 yesterday, driven by the broader market’s attempt to recover from last weekend’s sharp liquidation event. 

However, the rally may be showing cracks. The altcoin’s price has dropped roughly 10% today as bullish momentum fades, and on-chain indicators point to bears gaining ground.

BNB Shows Early Signs of Weakness

Readings from the BNB/USD one-day chart show that the coin’s Moving Average Convergence Divergence (MACD) is poised to form a bearish crossover, hinting at deeper losses in the near term. 

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BNB Moving Average Convergence Divergence. Source: TradingView

The MACD indicator identifies trends and momentum in an asset’s price movement, helping traders spot potential buy or sell signals through crossovers between the MACD (blue) and signal lines (orange). 

A bearish crossover occurs when the MACD line dips below the signal line, indicating a weakening in bullish momentum and a possible shift toward downward price movement. 

In BNB’s case, this technical pattern suggests that the coin’s recent upward surge may be losing steam, and short-term sellers could begin to dominate market activity.

Furthermore, the trend among BNB coin’s derivatives traders is no different, as reflected by its negative funding rate. Per Coinglass, this currently stands at -0.015% at press time, indicating low confidence among traders that BNB’s rally would continue. 

BNB Funding Rate. Source: Coinglass

Funding rates are periodic payments exchanged between long and short positions in perpetual futures contracts. When the funding rate is positive, long position holders pay short position holders, which occurs during bullish markets where demand for longs exceeds shorts. 

Conversely, a negative funding rate like BNB’s means short position holders pay longs, indicating that bearish sentiment is gaining ground and traders are hedging against a potential price decline.

This points to fading optimism among BNB market participants and increases the probability of a near-term pullback.

BNB’s Rally Pauses, Market Eyes Critical Support Levels

The waning bullish sentiment will continue to impact BNB’s price performance and push it further from its recent peak. If sell-side pressure strengthens, the altcoin risks breaching the support at $1,192 and falling toward $1,048.

BNB Price Analysis. Source: TradingView

However, this bearish outlook will be invalidated if new demand enters the market. In that scenario, BNB’s price could reclaim its all-time high and attempt to touch a new peak.