Why Coinbase Stock Could Rip Amid Bitcoin Bull Market, New NFT Platform

Coinbase Global Inc COIN announced its entry into the NFT market Tuesday with a sister platform, Coinbase NFT. With the NFT market hitting a whopping $10 billion in sales volume in the third quarter and growing, Coinbase could be set to substantially increase its revenues.

The cryptocurrency trading platform relies heavily on revenue from exchange fees and because of this, Coinbase’s stock has been known to move in tandem with Bitcoin BTC/USD. The stock has decoupled recently from the apex cryptocurrency, with Bitcoin making new highs while Coinbase trades in a long-term consolidation pattern.’

With movement into the NFT space and predictions Bitcoin could hit a staggering $500,000 within five years, Coinbase could be a steal at its current price. For technical traders and investors, there are still many hurdles the stock must overcome because it’s currently trading down over 40% from its April 14 all-time high of $429.54.

See Also: How to Buy Coinbase Stock Right Now

The Coinbase Chart: Coinbase reached a high of $294 on Aug. 11 before falling into a downtrend, making fairly consistent lower highs and lower lows on the daily chart. In its downtrend, the stock has settled into a falling channel between two parallel lines.

On Sept. 29, Sept. 30 and Aug. 4 Coinbase tested a support level near the $225 mark and bounced, which created a bullish triple bottom pattern. Since then, Coinbase has reversed course into an uptrend but has failed to break bullishly from the upper descending trendline of the channel.

On Monday, Coinbase attempted to break up from the channel but rejected it and traded lower in consolidation. The move up paired with the consolidation has settled the stock into a possible bull flag pattern, with the pole created between Oct. 4 and Oct. 11 and the flag formed between Monday and Wednesday.

If the flag formation is recognized, the measured move, which is equal to the length of the pole, is about 17%. This could indicate Coinbase could trade up toward the $285 level in the future.

Coinbase is trading in line with the eight-day exponential moving average (EMA) and above the 21-day, with the eight-day trending above the 21-day EMA, both of which are bullish indicators. The stock is trading about 2.5% above the 200-day simple moving average, which indicates overall sentiment is bullish.

• Bulls want to see big bullish volume come in and break Coinbase up through the flag formation and for momentum to carry the stock through the upper trendline of the channel. Coinbase has resistance above at $250 and $263.
• Bears want to see increased bearish volume continue to force the stock lower until it fails to hold support at $241. Below the level, Coinbase has further support at $233 and $225.