Basic Attention Token 2/10/2020 Technical Analysis with Trade Setup

Basic Attention Token Trade Setup 2/11/2020

Monthly Chart

Using basic horizontal support/resistance in combination with fibonacci extension and retracement tools, I’ve determined these levels to be significant for Basic Attention Token, taking all market history into account.

Basic Attention Token (BAT) Monthly Chart (Click to Enlarge)

$0.11 – December 2018 Lows

$0.17 – September 2019 Lows

$0.38 – April 2019 Highs

$0.50 – January 2018 Monthly Close

Basic Attention Token is currently at a significant resistance point at $0.28 with a cluster of fibonnacci levels and horizontal resistance.

The monthly RSI double bottomed at the 48 level and now breaking new highs at 53. There has also been a Squeeze forming for the last 9 months. Momentum signals movement to the upside, look for a break above 67.

Weekly Chart

Basic Attention Token (BAT) Weekly Chart (Click to Enlarge)

The weekly chart helps us get a better look at how these levels are currently playing out. Volume has been about average over the past 20 weeks, with the exception of a couple weeks here and there. The previous weeks candle opened above the 21 EMA and closed just below the previous high at $0.275, currently, BAT has found support at this level and is breaking out higher.

The 21 EMA is making higher lows, as is the RSI, which is now entering a bullish zone above 60. Price is trading well above the weekly 55EMA and the RSI is also confirming the price breakout by making higher highs. If the bulls can manage to push Basic Attention agove 28, the next upside target would be around $0.365, a gain of about 31%.

White dots on the RSI 50 line indicate a squeeze has fired over the past 4 weeks. All of these signs are in favor of the bulls.

Daily Chart

Basic Attention Token (BAT) Daily Chart (Click to Enlarge)

The Basic Attention Token Daily chart at first glance is at the top of a fairly obvious trading range, which would lead one to belive that its time to sell. A look closer however reveals bullish signs that confirm what the higher timeframes have already shown us.

Price is consolidating around the top of the local trading range. The oscillators tell the best story, with the RSI breaking new highs and showing signs of support around the 70 level. Other than a period in Nov-Dec 2019, the RSI has been trading above the 50 Line and MACD line since September 2019.

The Average Directional Index is above 40, indicating the market is starting to trend in the direction of the directional indicators, which show a bullish bias. Positive DI is trying to break above 25 and the Negative DI has been pushed well below 10, currently at 6.

The Daily 21EMA has crossed above the 200EMA and the 55EMA is starting to cross above the 200 as well, aslo known as the “Golden Cross.” This is a significant indication on the daily chart if it can hold through the week. Average volume has also been rising steadily and trading well above average over the past 9 days.

Trade Setup

Basic Attention Token Trade Setup 2/11/2020
Basic Attention Token (BAT) 4D Trade Setup (Click to Enlarge)

The Basic Attention Token 4 Day chart offers the best setup for a longer term trade. At the time of this writing, BAT is trading around $0.28. Using this level as a theoretical entry, a stop should be placed below the 200EMA, assuming if BAT doesn’t break a new high above $0.27, the trade is invalidated.

Profit targets were derived from the Monthly and Weekly charts. Targeting the $0.37 level and previous May 2018 highs at $0.48, this trade setup offers a potential gain of 80%, with a stop loss of 10% (8:1 R/R). Using a trailing stop-loss strategy, profit targets could exceed $0.50.