BNB has been highly un-correlated with BTC in recent weeks. Moving in the opposite direction almost perfectly sometimes. I suspect many were using it as a store of value in the bear market. Which might mean that the fall of BNB signals strength for BTC.
How long you suspect this BTC rally to last might indicate your choices with BNB. For short-term bulls, it might be good to accumulate as much cheap BNB as you can while the price falls, for the next even temporary BTC bear market could result in some vigorous price action out of BNB.
@Keegan.ead, hi.. definitely, according to above chart, shows inversre relationship, which one is steering ???
OxHip
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@cryotoman0, The price of BTC I think motivates a lot. People look for places to dump their crypto safely when bitcoin (and most of the altcoins) turn downwards. Traditionally this has been stablecoins like Tether. But somehow BNB established itself as being stronger in a bear market. Likely because of Binance's move in using BNB for paying fee's, many people hold BNB, and don't sell it because they want the fee reduction. This probably created a small edge in the market (sometimes all you need), which further has a circular effect. More and more people dumping their BTC and altcoins into BNB instead of Stablecoins.
When prices in the rest of the market rally, lots of the equity stored in BNB gets sold into the rest of the market again, causing the BNB price to drop.
The market goes up and down, I don't think this means bad news for BNB. I think un-correlated coins like this are ideal. Perfect for a rebalancing strategy.
cryotoman0
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@Keegan.ead, ur saying bnb (and tether) in relation to btc, holds the wheel & steers?? or , really there is no definable relationship---just coincidence because traders try to preserve their money/rebalance??
AlanSantana
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@cryotoman0, More like it can be taken as a bullish signal for Bitcoin.
EduardZimmermann
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@Keegan.ead, Imho not just for rebalancing only. When you look at the chart i posted above I see a token with a very good performance history. The business model (using BNB for paying only 50% of the trading fees and a BNB market with meanwhile 70+ coins) creates a good baseline on the trading volume. And as Binance' business grows and extends BNB's price will rise further. Seriously bad news on Binance will possibly affect BNB to the opposite aswell. So investors should always have an eye on Binance' blog posts or news on Binance in general. I don't know that many coins/tokens in detail but BNB is the only one I know which has a working and wealthy business model with a business-driven trade-volume asa baseline plus fundamental news.
How long you suspect this BTC rally to last might indicate your choices with BNB. For short-term bulls, it might be good to accumulate as much cheap BNB as you can while the price falls, for the next even temporary BTC bear market could result in some vigorous price action out of BNB.