• BAT non-exchange wallet holders increase their accumulation following the dip earlier this month.
  • On-chain metrics suggest that the path of least resistance is downwards until formidable support is found.

Basic Attention Token, like many other cryptocurrencies in the market, is in the middle of a retreat following the losses posted in the first week of September. Although support at $0.22 came in handy, recovery has not been rapid as investors expected. Resistance at $0.28 has continued to give the bulls are a hard time, hence delaying recovery.

Why are BAT large volume holders stocking up?

Santiment, a leading provider of on-chain data in the industry, says Basic Attention Token whales “appear to be back to accumulating.” The large non-exchange wallets are perhaps buying the dip in anticipation that BAT will reverse the trend and embark on a massive rally to $3.5.

Top non-exchange holders of BAT

BAT holder distribution

According to the data, the amount held by top non-exchange addresses has increased significantly from 359.51 million BAT on September 8 to 376.33 million BAT on September 15. There was a spike to 392.86 million on September 14, but some wallets offloaded some coins. Generally, whales are accumulating, and in due course, this could lead to a reversal in the price.

Basic Attention Token technical analysis

The stubborn resistance at $0.28 led to an ascending triangle, as seen in the chart below. Ascending triangles are common patterns in technical analysis. A horizontal line is drawn alongside the highs made by the asset, while an ascending trendline is drawn to mark the lows. Breakout from these patterns can be either up or down. However, ascending triangles tend to signal the continuation of the trend before.

For instance, the BAT/USD 4-hour chart's ascending triangle seems to be continuing the downtrend before the pattern. The declines are currently supported by the Relative Strength Index (RSI) as it dives towards the oversold (30 and below). If support at $0.24 caves in, we can expect BAT to extend the lower leg back to September’s support at $0.22.

BAT/USD 4-hour chart

BAT/USD price chart

Basic Attention Token on-chain analysis

The IOMAP metric by IntoTheBlock highlights the struggle BAT is bound to face in its recovery. The initial resistance at 0.24 - $0.25 seems relatively easy to bring down considering the 12,050 addresses that previously bought 24.82 million BAT in the range. Unfortunately, the price action above this zone will run into extreme selling pressure between $0.25 and $0.26. Only when this zone is flipped into support is that the price can rally to $0.35.

IntoTheBlock IOMAP

BAT IOMAP by IntoTheBlock

On the flip side, initial support between $0.23 and $0.24 does not seem strong enough to hold BAT, at least not for long. Note that 12,630 addresses had previously purchased 40.62 million BAT in this zone. A retreat below this first support area could see BAT spiral to the major support at $0.2130 - $0.22, where 9,020 addresses bought a 142.82 million BAT.

The decrease in the number of new addresses also validates the bearish notion. IntoTheBlock shows that the new addresses created on the network dropped from 1,170 on September 13 to 966 on September 15. The downward trend signals a higher probability of continuing bearish price action.

BAT new addresses

BAT new addresses by Santiment

Looking at the other side of the fence

Although most of the indicators are bearish for BAT, there is a likelihood of the whales currently accumulating becoming the ultimate winners, especially if the double-bottom pattern in the hourly range comes into play as expected. Support at $0.24 will have to hold water while bulls shift their focus to the critical resistance between $0.25 and $0.27. The short term recovery is also highlighted by the Relative Strength Index (RSI) as it moves closer to the midline.

 

Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.

If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.

FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.

The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.

Cryptos feed Join Telegram

Recommended content


Recommended Content

Editors’ Picks

Bitcoin Weekly Forecast: BTC’s Q3 close and what to expect in Q4?

Bitcoin Weekly Forecast: BTC’s Q3 close and what to expect in Q4?

Bitcoin price is trading above two crucial levels, suggesting a stable foothold. Combining this outlook with a bullish divergence signal, BTC holders should expect a favorable outcome. However, since the third quarter will end in a few hours, there is bound to be abnormal volatility in the market, which could trigger massive moves in either direction, so investors need to be cautious. 

More Bitcoin news

Shiba Inu price: Shiba Eternity download day the biggest bullish catalyst in SHIB history?

Shiba Inu price: Shiba Eternity download day the biggest bullish catalyst in SHIB history?

Shytoshi Kusama, the project lead for Shiba Inu, has dropped a teaser about Shiba Eternity for the SHIB community. Proponents expect the launch of the collectible card game to be a bullish catalyst for SHIB.

More Shiba Inu News

Staking is coming to Chainlink this December as LINK price stands firm

Staking is coming to Chainlink this December as LINK price stands firm

LINK is trying to find its feet in the wake of declines that followed its rejection from resistance at $8.40. Bulls have managed to sustain a generally up-trending market and Chainlink is up nearly 17.50% from its September low at $6.56.

More Chainlink News

Ethereum Classic bulls take charge, a retest of $30 on the cards

Ethereum Classic bulls take charge, a retest of $30 on the cards

Ethereum Classic price ranges with no directional bias in sight. This trend could continue unless Bitcoin decides to do something. Regardless, investors should prepare for a minor downtrend before ETC rallies. 

More Ethereum Classic news

Bitcoin: BTC’s Q3 close and what to expect in Q4?

Bitcoin: BTC’s Q3 close and what to expect in Q4?

Bitcoin price has developed a bullish divergence with RSI, hinting at more upside. Despite the optimistic technicals, investors should expect volatile swings before the end of the third quarter of 2022. 

Read full analysis

BTC

ETH

XRP