We don’t usually cover traditional stocks at CND but Coinbase (COIN) is a special-case since the exchange currently does not offer a token like most others. The current market capitalization at the time of writing is roughly $64.29B according to MarketWatch, placing it between XRP and BNB if it were listed on CoinMarketCap right now. This ranking makes sense considering Binance and Coinbase are both top exchanges in different parts of the world.
Coinbase officially went live on 4/14 shortly after lunch, New York time. It immediately dumped and has since been forming an equilibrium, or symmetrical triangle. It has been said that the reference price of Coinbase stock sits around $250.
Looking at the momentum, we can see there is some pressure pushing to the downside but we don’t have very much price data yet. Going purely on reference price, current indications and Elliot Wave theory, we can lean toward this triangle breaking to the downside. By measuring trend projections using the Fibonacci extension tool and measuring the size of the triangle, we find confluence at a price target of approximately $300 even.
This is a good psychological number and not far off from reference price. If this scenario plays out, we would look for further consolidation in this range and evaluate whether we will see further continuation or a potential reversal. The key for reversal would be a divergence forming with a lower low on price and a higher low on the momentum.
Of course, the triangle could always break to the upside as well, in which case we could eye a consolidation target around $375. We will have a better idea once more price data comes in.
So does it make sense to buy Coinbase stock? Depends on your investment goals but one could assume its price action would follow that of the overall cryptocurrency market as we’ve seen with other stocks like Riot Blockchain. If you are heavy into crypto, buying Coinbase stock may not diversify your overall investment portfolio very well, but it could make a great addition to your asset collection if you like to invest in exchange tokens or if you just want to own a different asset class.