Coinbase (COIN) stock finds support after brutal breakdown

Coinbase Global (COIN), the leading cryptocurrency exchange platform, has experienced a punishing selloff that's left many bulls questioning their positions. After trading near $387 just weeks ago, shares have collapsed to the $267 area—a decline steep enough to trigger serious technical damage. But the question traders are asking now isn't about what happened. It's about what happens next.

The chart tells a story of deteriorating momentum. See that yellow descending trendline connecting the recent peaks? It was your early warning system. Price couldn't reclaim higher ground, instead making a series of lower highs that culminated in a decisive breakdown. When COIN cracked through support, the selling intensified. That’s a classic technical breakdown behavior where former support becomes resistance.

What catches my attention now is where we've landed. The current bounce zone around $267 sits just above what I'm calling the "line in the sand" at $231. This lower level represents the absolute floor—the support zone established way back when COIN was building its base earlier this year. Think of it as the foundation of the entire structure. If that $231 level gives way, we're looking at a materially different setup, one that opens the door to significantly lower prices.

So what's the trade here? For aggressive buyers, this retracement zone offers a potential entry with a clearly defined risk parameter. You're betting that the recent selling was overdone and that COIN can stabilize here for a bounce back toward that descending trendline or even the $387 resistance zone above. Your stop? It has to be below $231. That's non-negotiable. If price violates that foundation, the thesis breaks.

For bears, patience pays. A failure to reclaim momentum here, especially if COIN struggles below the descending trendline, keeps the door open for retests of $231 or worse. Watch how price behaves at this retracement level. Weak bounces and quick rejections would confirm sellers remain in control.

The setup is binary: either COIN stabilizes and attempts a recovery, or it continues probing lower. Either way, that $231 line tells you everything you need to know about which scenario is playing out.