Coinbase stock price has come under pressure in the past few days as investors look for the next catalyst. The COIN share price was trading at $224 on Wednesday, lower than the year-to-date high of $282. That means that it has retreated by over 20% from its highest point, meaning that it has moved into a bear market.
Focus shifts to May 2nd
Coinbase stock has moved sideways in the past few weeks as the crypto industry has fizzled. Bitcoin has retreated from the year-to-date high of $73,500 to about $63,000. Similarly, Ethereum has plunged from over $4,000 to about $3,100.
Other altcoins like Hedera Hashgraph, Pyth Network, Worldcoin, and Celestia have all been in a strong bearish trend. In all, the combined market cap of all cryptocurrencies has dropped from over $3 trillion earlier this year to about $2.32 trillion.
Coinbase and other crypto exchanges tend to do well when cryptocurrencies are in a strong bull run. A closer look at the volume flows shows that Coinbase handled volumes of over $2.8 billion, down from a peak of over $5 billion earlier this year.
Looking ahead, the next important catalyst for the COIN share price is the company’s earnings scheduled for March 2nd. These results will provide more information about its transaction revenue.
Most importantly, the results will provide information about its growing custodian business since it is the biggest holder of all Bitcoin ETF assets. Also, the company’s Base platform has grown in the past few months as its total value locked (TVL) jumped to over $1 billion, making it the 6th biggest company in the industry.
The most recent financial results show that the company’s revenue rose from $605 million in Q4’22 to over $905 million. It also moved from a net loss of $557 million in Q4’22 to a profit of over $273 million.
Analysts expect that Coinbase’s revenue will move to over $1 billion as it earned 93 cents per share. The expectation is that the revenue growth will continue albeit at a slower pace now that cryptocurrencies have moved into a bear market.
Coinbase stock price forecast
The daily chart shows that the COIN share price has been in a strong bull run in the past few months. It has soared from a low of $47 in June 2023 to the current $225. The stock has remained slightly above the 50-day moving average, which is a positive sign.
However, the Relative Strength Index (RSI) has formed a bearish divergence pattern. The Bull Bear Power indicator has moved below the neutral point, which is a bearish sign. Therefore, the outlook for the stock is mildly bearish with the next point to watch being at $188.54, its highest swing in December. This retreat will likely happen ahead of the company’s earnings.
Contributors
