COIN Stock Earnings: Coinbase Global Inc may not matter to market as Musk hits the sector
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UNLOCK OFFER- Coinbase has issued projections that it will report $1.8 billion in Q1 revenue.
- Shares have recently bounced off $250.50.
- COIN’s prospects appear tied to the price of BTC.
Shares of Coinbase (Nasdaq: COIN) gave up ground in the premarket this morning, a bad sign ahead of earnings after the market closes later in the day for one of this spring’s most hyped IPOs.
The cryptocurrency exchange and custodian has been on a downward trek since the IPO in mid-April. After trading to $429 on its first day, shares fell to just above $250, the reference value it was given by its investment bank advisors, before rallying this week to a recent high just below $307. Shares, however, closed on May 12 at $283.61.
COIN stock news: Q1 earnings will determine the stock’s trajectory
At the IPO, Coinbase handed out Q1 and full year projections. If the company meets or exceeds its projections, the market may turn optimistic on this fiat-crypto hybrid.
For Q1, the company expects earnings between $730 million and $800 million on revenue of $1.8 million. One point of concern may be that the price of Bitcoin has been treading water since the IPO, and the past 24 hours before earnings have seen a flash crash in the top cryptocurrency. Since Coinbase earns the vast majority of its revenue from exchange fees, higher asset prices tend to mean more revenue. Bitcoin making up an enormous share of the company’s fees means that for the foreseeable future COIN may be tethered to the BTC price.
Additionally, Coinbase expects 6.1 million monthly transacting users out of 56 million total verified users. Discrepancies in the final tally for either figure may unleash fear or the animal spirits on an uncertain share price.
For the full year, Coinbase expects operations and administrative expenses to fall between $1.3 billion and $1.6 billion, as the exchange seeks to augment its 12% share of the crypto trading space.
Technical Analysis: Will COIN break back above $307?
COIN is obviously highly correlated to Bitcoin which has suffered the Elon Musk affect overnight. Support is evident at $251.37 with resistance at $307. All levels in this one are relatively weak as there is not a lot of price discovery given COIN is a newbie. The $307 level has had multiple tests though looking at the short-term chart. This price level also saw a crossover sell signal from the Moving Average Convergence Divergence (MACD) and Directional Movement Index (DMI). A break of $307 should see confirmation from one of the indicators MACD or DMI, preferably both. A break and COIN looks to $354 as the next target resistance. Both RSI and CCI have been getting close to oversold levels recently, so this needs watching.
At the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
This article is for information purposes only. The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice. It is important to perform your own research before making any investment and take independent advice from a registered investment advisor.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to accuracy, completeness, or the suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. The author will not be held responsible for information that is found at the end of links posted on this page.
Errors and omissions excepted.
- Coinbase has issued projections that it will report $1.8 billion in Q1 revenue.
- Shares have recently bounced off $250.50.
- COIN’s prospects appear tied to the price of BTC.
Shares of Coinbase (Nasdaq: COIN) gave up ground in the premarket this morning, a bad sign ahead of earnings after the market closes later in the day for one of this spring’s most hyped IPOs.
The cryptocurrency exchange and custodian has been on a downward trek since the IPO in mid-April. After trading to $429 on its first day, shares fell to just above $250, the reference value it was given by its investment bank advisors, before rallying this week to a recent high just below $307. Shares, however, closed on May 12 at $283.61.
COIN stock news: Q1 earnings will determine the stock’s trajectory
At the IPO, Coinbase handed out Q1 and full year projections. If the company meets or exceeds its projections, the market may turn optimistic on this fiat-crypto hybrid.
For Q1, the company expects earnings between $730 million and $800 million on revenue of $1.8 million. One point of concern may be that the price of Bitcoin has been treading water since the IPO, and the past 24 hours before earnings have seen a flash crash in the top cryptocurrency. Since Coinbase earns the vast majority of its revenue from exchange fees, higher asset prices tend to mean more revenue. Bitcoin making up an enormous share of the company’s fees means that for the foreseeable future COIN may be tethered to the BTC price.
Additionally, Coinbase expects 6.1 million monthly transacting users out of 56 million total verified users. Discrepancies in the final tally for either figure may unleash fear or the animal spirits on an uncertain share price.
For the full year, Coinbase expects operations and administrative expenses to fall between $1.3 billion and $1.6 billion, as the exchange seeks to augment its 12% share of the crypto trading space.
Technical Analysis: Will COIN break back above $307?
COIN is obviously highly correlated to Bitcoin which has suffered the Elon Musk affect overnight. Support is evident at $251.37 with resistance at $307. All levels in this one are relatively weak as there is not a lot of price discovery given COIN is a newbie. The $307 level has had multiple tests though looking at the short-term chart. This price level also saw a crossover sell signal from the Moving Average Convergence Divergence (MACD) and Directional Movement Index (DMI). A break of $307 should see confirmation from one of the indicators MACD or DMI, preferably both. A break and COIN looks to $354 as the next target resistance. Both RSI and CCI have been getting close to oversold levels recently, so this needs watching.
At the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
This article is for information purposes only. The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice. It is important to perform your own research before making any investment and take independent advice from a registered investment advisor.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to accuracy, completeness, or the suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. The author will not be held responsible for information that is found at the end of links posted on this page.
Errors and omissions excepted.
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