Skip to main content
Publish date:

Coinbase Has 3 Main Levels to Watch After Earnings Selloff

Coinbase stock is off the lows, but is getting hit on earnings. Here are the two levels it needs to reclaim and the one level it needs to hold.

Coinbase  (COIN)  stock is down about 5.5% after reporting disappointing earnings, but that’s much better than its morning losses.

At its session low, shares were down about 10.5% on Wednesday.

The decline comes even as Bitcoin and Ethereum — the two largest cryptocurrencies by market cap — made new all-time highs on the day. That’s after inflation data surged to a 31-year high.

Coinbase missed on earnings expectations while its upbeat outlook wasn’t enough to reverse the stock’s losses.

This is what we’re seeing with growth stocks: Investors are not in the mood to buy these stocks with the exception of those that report excellent results.

For example, Palantir  (PLTR) - Get Palantir Technologies Report stock has been under pressure for a few days now, which came after the company reported in-line earnings results and upbeat guidance. Still, the market didn’t care.

Short of that, these names are being sold even as the broader market remains near all-time highs.

Let’s look at the three main levels to watch in Coinbase stock.

Trading Coinbase Stock

Daily chart of Coinbase stock.

Daily chart of Coinbase stock.

TheStreet Recommends

Those who are long Coinbase stock were likely relieved as the stock rebounded from its early morning selloff. However, that relief has likely soured with the fade from today’s high.

All of this action fits into the three levels we have our eye on.

The first level is $325. Shares opened above this level, traded down to a low of $320 and rebounded higher.

This area was notable resistance in late October and a key breakout level earlier this month. For Coinbase to hold above this level — even with today’s hearty fade from the highs — bodes well for bulls.

That’s particularly true when considering that the stock is still up 47% from the October low and is up more than 33% over the last four weeks.

The second level of interest is the 10-day moving average. This short-term trending moving average hasn’t been tested in almost a month. However, the stock is currently below this mark now.

Bulls want to see the stock reclaim this mark, as it keeps the trend in their favor.

Our third level of interest is just above the 10-day, sitting up at $345. This level also happens to be the 61.8% retracement, which served as resistance until this week’s breakout.

If Coinbase stock can reclaim the 10-day moving average, this level will be back in play.

If the stock loses the $325 level as support, today’s $320 low is on the table, followed by the 21-day moving average, then the $294 to $300 area.