Coinbase Global, Inc (NASDAQ: COIN) was rising over 6% Thursday as the crypto exchange heads into its fourth-quarter earnings, expected after the market closes Feb. 13.
When Coinbase printed a Q3 miss on Oct. 30, the stock dropped 15.34% the following session before reversing course into a strong uptrend, which brought it to a high of $349.75 on Dec. 6. Since that date, Coinbase has been consolidating within a large triangle pattern between about $240 and $326.
For the third quarter, Coinbase reported revenue of $121 billion, which missed the $126-billion consensus estimate, according to TradingView. The company reported earnings per share of 28 cents, heavily beating the Street estimate of 41 cents.
For the fourth quarter, analysts, on average, estimate Coinbase will report earnings per share of $2.11 on revenues of $184 billion.
Ahead of the Coinbase report, two analysts weighed in with forward-looking projections, according to TipRanks. Citigroup raised its price target on Coinbase to $350 from $275, maintaining a Buy rating, and citing the exchange’s strong position amid renewed crypto enthusiasm under a Trump administration. H.C. Wainwright also boosted its COIN target to $330 from $255, expecting the company to surpass Q4 earnings and revenue estimates due to favorable market conditions.
From a technical analysis perspective, Coinbase’s stock looks bullish heading into the event, attempting to break up from the upper descending trend line of a triangle pattern. It should be noted that holding stocks or options over an earnings print is akin to gambling because stocks can react bullishly to an earnings miss and bearishly to an earnings beat.
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The Coinbase Chart: Coinbase began trading within a triangle pattern on Dec. 6, and has been consolidating mostly sideways within the formation, forming a series of short uptrends and downtrends as it works toward the apex. On Thursday, the stock was attempting a bullish break from the pattern, regaining the eight-day and 1-day EMAs and the 50-day SMA.
Bulls want to see Coinbase close near its high-of-day, which would cause the stock to print a bullish Marubozu candlestick, suggesting higher prices will come on Friday. If that happens, Coinbase will have confirmed a break from the triangle pattern, which is bullish.
Bears want to see Coinbase suffer a negative reaction to its earnings print, which could cause the stock to lose support at the EMAs and 50-day SMA. If that happens, Thursday’s high-of-day will mark the next lower high within the stock’s current downtrend, indicating lower prices are on the horizon.
Coinbase has resistance above at $311 and at $326. The stock has support below at $293 and at $276.
