there is a product exactly for that.
Originally Posted by
LostitoaBianchi
I was going to attach a small sports towel on my bike to wipe my hands and/or face with while riding on hot days. I could not find any posts of other people discussing such a thing. Im wondering if there is anyone out there with a neat setup that addresses the same issue. Right now I am leaning towards attaching a retractable badge holder to my handlebar/top tube with the towel hopefully being light weight enough to just sit on there until I pull on it.
There is a product made just for that. It is available at riderag.com. it works quite well.