BNB Price Stable at $655, Potential 70% Gain Ahead

Binance Coin (BNB) has experienced a period of relative stability, with its price remaining largely unchanged this week. As of Saturday, BNB was trading at $655, a level it has maintained for several months. This consolidation phase, however, may be setting the stage for a significant price movement in the coming months.

The weekly chart indicates that BNB has been in a consolidation phase, oscillating between support and resistance levels at $495 and $750 since March of last year. This pattern is characteristic of the cup-and-handle formation, a bullish technical pattern that suggests a potential upward trend. The cup-and-handle pattern begins with an asset in a strong bull run encountering resistance and gradually retreating to form a rounded-bottom pattern. The handle section involves a period of consolidation or pullback, which can last from a few days to over a year. If this pattern completes on the weekly or monthly chart, it typically signals a prolonged upward movement.

In the case of BNB, the depth of the cup is approximately 70%. Measuring the same distance from the current price of $660 suggests a potential target price of $1,122. The initial price targets to watch are the December high of $748 and the psychological level of $1,000. A move above $1,000 would indicate further gains, potentially reaching the target of $1,122. However, it is important to note that this prediction is based on the weekly chart, meaning the target may take some time to materialize. A drop below the support level of $495 would invalidate this bullish outlook.

Several catalysts could drive the BNB price higher in the coming months. One of the key factors is BNB's deflationary nature, achieved through two token burn mechanisms. The first burn occurs from the regular fees generated on the BSC Chain, which typically incinerates about 750 BNB tokens valued at nearly $500,000 per week. The second burn is quarterly and based on the BNB price and the number of blocks generated in the quarter, burning tokens worth over $1 billion. This makes BSC one of the most deflationary chains in the crypto industry.

Additionally, the BSC Chain is positioning itself as a strong alternative to Solana and Ethereum, known for congestion and high fees, respectively. Regular updates, including the Pascal and Lorentz upgrades, and the upcoming Maxwell upgrade, which aims to reduce block time to 0.75%, are part of this strategy. The ongoing staking inflow, with investors adding tokens worth $90 million in the last 30 days, is another positive sign for BNB. Furthermore, if the SEC approves an ETF filed by a top asset manager, it could provide an additional boost to the BNB price.