BAT/USD price analysis: Can it break towards the upside?

Cryptocurrency heat map by Coin360

It has been another red day for the wider cryptocurrency markets today.

Many coins failed to hold their key supports, particularly Bitcoin (BTC) which allowed $35,000 to slip out of its grasp.

Interestingly, BTC dominance has been on the decline for just over a week, dropping from 48% to just above 45% in the early hours of this morning.

During the last 24 hours, BAT has seen little movement; rising 0.26%. BAT currently sits at number 78 on CoinMarketCap with a circulating market cap of $885.27 million. 

BAT/USD price movement over the last 48 hours

Over the last two days, BAT has shown some short-term uptrend in respect of both the Moving Average (MA) and the trend line. The shorter 50 period MA has crossed the longer term 200 MA to the upside which is also a bullish indication.

It is clear to see the price is conforming into an ascending triangle. Historically this has been a signal that it will break towards the upside. 

This indicates that sellers in the market are becoming exhausted near the upper resistance and will eventually give in to the buyers of the market. In this case, $0.61 would be the area to watch out for.

However, it is important to note that while the price forms this pattern, the volume does not support it. For a successful breakout to the upside, significant volume would have to be shown – and that is yet to happen. 

BAT/USD chart by TradingView

BAT/USD four-hour chart: Is it giving investors false hope?

The four-hour chart provides both bullish and bearish outlooks for the coin, and it can be hard to differentiate what is the stronger signal. While it is clear to see the price has broken out from the bearish trend and has formed an ascending triangle; it is impossible to ignore the fact that the macro trend is still bearish.

The 50 MA, price fall below the 200 MA and the recent uptrend in price have not been accompanied by a robust amount of volume to support it. The strong resistance at $0.61 has been rejected three times previously, with each test having a weaker amount of volume to support the attempt.

It can be expected for the price to break towards the downside. A first target of $0.50 can be anticipated and, should that not hold, a second target of $0.45 comes into view. Should the price break to the upside, investors need to be wary of a false breakout. Expect to see the resistance at $0.61 turn to support before entering a trade. 

BAT/USD chart by TradingView

Source: coinrivet.com