Will BNB Token Burn Drive Price Back To $600?

In an effort to regulate Binance Coin’s (BNB) circulation, Binance Chain announced the completion of the 31st BNB quarterly burn. It saw 1,500,000 tokens valued at $916,174,342 burned.

This has brought back focus on the coin’s price action and its possibility to reach to $600 levels again.

Binance Burns 1.5 Million BNB Tokens

During its latest quarterly BNB burn to effect a cut in the overall circulation of Binance token, the firm disposed of 1.5 million tokens.

Binance CEO CZ confirmed that a total tokens worth $916 million tokens have been burned.

Consequently, the approach aligns with a long-term plan to lower BNB token supply to 100 million.

The entire BNB token supply has reached 140.89 million, yet ongoing burn operations caused circulation amounts to drop.

In addition, the burn process introduced through the BEP95 proposal determines the number of tokens to be burned based on BNB price and the Binance Smart Chain blocks.

This quarterly burn event is intended to reduce the overall supply of the coin, thereby possibly pushing up its price.

Binance Coin Price Saw a Decline Despite the Burn

However, the widespread positivity about token burns failed to produce the desired price increase for BNB.

The most recent BNB token burn occurred when the market price reached $582.58 with a 1.10% daily decrease.

In contrast to the typical market sentiment associated with token burns, which can sometimes push the price higher, BNB has experienced a 7.2% decline over the past month.

More so, the market has demonstrated a downward trend because investor sentiment weakens due to macroeconomic factors as well as bearish market dynamics.

However, despite the current price decline, the token burn has maintained a positive effect on investor sentiment.

The increase in 24-hour trading volume, which surged by $1.39 billion, reflects continued interest in BNB, suggesting that many traders remain hopeful about its potential.

Technical Indicators Point to Potential Price Reversal

On the technical indicators, BNB price is moving toward a rally despite its recent decrease in value.

The price has been hovering around the $589 but analysts are pointing to the 50-day Exponential Moving Average (EMA) as a key support level.

A successful breakout above the 50-day EMA, along with a successful move through the $600 resistance level, indicates potential future price increases.

Moreover, the Moving Average Convergence Divergence indicator provides signs of momentum strength despite the sustained bear market conditions. 

A potential breakout above the descending trendline resistance could increase the likelihood of BNB testing higher resistance levels.

If BNB price surpasses the $600 mark, analysts have set their sights on the next key target around $635.

Additionally, the Stochastic RSI is currently at 74.09, indicating that Binance Coin is in the overbought zone.

This suggests that the price may be due for a pullback or consolidation. The Stochastic RSI above 70 signals that the asset is potentially overbought in the short term and could face downward pressure if the momentum weakens.

Meanwhile, recent analysis revealed that Binance Coin (BNB) has shown significant strength in the market.

Social sentiment data from LunarCrush showed BNB with the highest score, as BNB chain users exhibited both strong demand and practical application within the system.

BNB has managed to establish successive higher low points in the market since February, demonstrating its financial strength and future potential for expansion.