Trade Recommendation: Basic Attention Token
The Basic Attention Token/US Dollar (BAT/USD) pair climbed as high as $0.3877 on November 8, 2018. This move was fueled by the anticipation associated with the market’s Coinbase listing. Many market participants believed that Basic Attention Token would pump after getting listed on the exchange. This logic is sound but the market is highly illogical so it moved in an unexpected manner.
BAT was a sell on news as it dumped 28% overnight after the Coinbase listing. It has been dumping in the last few days but it looks like the end is in sight.
Technical analysis shows that Basic Attention Token is en route down to support of $0.2375. We are confident that this area will hold for several reasons.
First, the market’s dump is so steep. It happened with very little consolidation and almost no pullbacks. This is not sustainable. It’s only a matter of time before bears face exhaustion.
On top of that, we looked at the 4H RSI and saw that it is resting above support of 32. The indicator is in near oversold territory. This tells us that bears cannot keep up this rampage for long.
Lastly, volume has been declining since the November 8 dump. This is another indication of bearish exhaustion. Without volume, bears will not have the strength to take out support of $0.2375.
The strategy is to buy the dip as close to $0.2375 support as possible. If bulls hold this support, the market will likely consolidate for a bit before bouncing to our target of $0.30.
The process may take less than a month.
4-Hour Chart of Basic Attention Token/US Dollar on Binance
As of this writing, the Basic Attention Token/US Dollar pair is trading at $0.25822 on Bitfinex.
Summary of Strategy
Buy: As close to $0.2375 as possible.
Disclaimer: The writer owns bitcoin, Ethereum and other cryptocurrencies. He holds investment positions in the coins, but does not engage in short-term or day-trading.
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