Coinbase fell to a key support level on Tuesday. Is Coinbase stock a buy or sell now? Some may be tempted to buy the stock as it tests support, but investors should examine key chart features and technical indicators and look for proper buy points.
Shares leaped 24% on May 13 after news that Coinbase would be the first cryptocurrency exchange to join the benchmark S&P 500 on May 19.
Coinbase replaced Discover Financial on the index after Discover was purchased by Capital One. Meanwhile, bitcoin traded around $109,000 during Tuesday's session after recently hitting an all-time high above $111,000.
Shares of Coinbase are holding the 21-day moving average.
Coinbase in early May delivered an earnings beat for its first quarter, with $1.94 per share vs. analyst views of $1.88. Revenue came in just a little lower than estimates of $2.1 billion.
On MarketSurge charts from Investor's Business Daily, Coinbase stock has gapped up past its 200-day moving average – a level of resistance.
Shares bounced 17% on April 9 when President Donald Trump announced a 90-day pause on tariffs for most countries.
On March 18, analysts at Bernstein gave the stock a hefty price target of $310 with an outperform rating. The crypto exchange is best positioned to benefit from pro-crypto moves from the Trump administration, Bernstein noted.
Earlier, Coinbase stock rose amid reports the cryptocurrency exchange was seeking information from the Securities and Exchange Commission on what it spent to conduct investigations of the crypto industry. Coinbase also wanted a list of targeted companies and other information about the SEC's crypto enforcement unit.
The action followed news the SEC may drop a two-year lawsuit claiming that Coinbase should be regulated like a conventional stock. In a Feb. 21 post on Twitter/X, the company said "SEC staff have agreed to dismiss their case against us (pending Commission approval)."
Crypto Task Force Formed
The SEC appointed a crypto task force to develop a framework for digital assets. The agency had maintained that most crypto assets are securities and fall under its regulations. But Coinbase had been petitioning for a separate set of crypto rules since 2022.
The smoke has been clearing for other exchanges and trading platforms as well. On Feb. 24, Robinhood, another trading platform for crypto assets, said the SEC was dropping a similar lawsuit.
Coinbase's Composite Rating is 77 out of a best-possible 99, while its Earnings Per Share Rating is 37, according to IBD Stock Checkup.
The stock is outperforming several other stocks in the Investor's Business Daily database, going by its Relative Strength Rating of 89.
Find Stocks To Watch: From Top IPOs To Large And Small Caps
Coinbase Stock Crashes On DeepSeek News
On Jan. 27, shares of Coinbase crashed 7% amid news that DeepSeek, a Chinese artificial intelligence startup, offered a far more efficient artificial intelligence training model than its U.S. counterparts.
The White House on Jan. 23 released an executive order with a view to promoting access to public blockchains for mining, validating and self-custody purposes. The order also made a mention of promoting stablecoins backed by the U.S. dollar while taking steps to prohibit the use of a Central Bank Digital Currency within the U.S.
Trump in March established a President's Working Group on Digital Assets Markets which will provide its proposals for a regulatory framework for digital assets within 180 days.
The Senate voted to appoint Sen. Cynthia Lummis, R-Wyo., a supporter of cryptocurrencies and a backer of the bitcoin strategic reserve fund, to lead the Banking Subcommittee on Digital Assets.
Bitcoin Affects Coinbase Stock Price
The price of bitcoin has affected the stock's performance. Bitcoin touched a then all-time high of $108,659 on Jan. 20, as Trump took office. After retreating from that level, the digital asset later rebounded and notched fresh record high of $111,970.17 on May 22, according to CoinMarketCap.
Coinbase stock had an impressive run in 2024, gaining 43% while the S&P 500 rose 23%. That performance followed an even more impressive gain in 2023, when the stock rallied 391%.
Bitcoin doubled in 2024, and in 2023, it gained 150%. In 2022, bitcoin crashed more than 65% while Coinbase stock suffered an 86% fall.
How Invested In The Stock Market Should You Be Right Now?
Coinbase started in 2012 as a simplified way of trading bitcoin. The stock listed on the Nasdaq in April 2021 at an initial offering price of $250 a share. A direct listing allowed investors to sell the stock directly at the market price. The stock quickly rocketed to an all-time high of 429.54 but crashed, reaching an all-time low of 31.55 in January 2023.
Coinbase is the largest U.S. cryptocurrency exchange and allows trading in several other digital coins. The platform also offers crypto staking, custody and transfer services. Bitcoin and ethereum see the highest volume, but several other coins are also listed and trade on the Coinbase platform.
Mutual funds own 29% of shares outstanding. Funds have been buying the stock over the last 13 weeks, giving it an Accumulation/Distribution Rating of B on a scale of A-E.
Coinbase Holds Key Level
Coinbase has carved a handle with a buy point of 277.01. Shares are just below that entry. A strong breakout would make the stock a buy.
But the 50-day line has fallen below the 200-day moving average. That is a bearish signal.
Spot Bases And Buy Points With Pattern Recognition
Also, fluid crypto rules and policies can move the stock in ways for which investors must prepare.
Please follow VRamakrishnan on X/Twitter for more news on the stock market today.
