Coinbase Jumps Higher In Tandem With Bitcoin: Where's The Crypto Platform Headed Next?

Coinbase Global, Inc COIN gapped up about 4% on Friday, following Bitcoin, which began rising at 9 p.m. on Thursday to trade up over 5% by Friday morning.

The gap up open allowed Coinbase to pop above a heavy resistance level just under the $70 mark. Coinbase has been rejecting that level since Feb. 9, unable to close a trading session above the area.

The move higher also confirmed Coinbase is trading in an uptrend pattern. An uptrend occurs when a stock consistently makes a series of higher highs and higher lows on the chart.

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The higher highs indicate the bulls are in control while the intermittent higher lows indicate consolidation periods.

Traders can use moving averages to help identify an uptrend, with rising lower time frame moving averages (such as the eight-day or 21-day exponential moving averages) indicating the stock is in a steep shorter-term uptrend.

Rising longer-term moving averages (such as the 200-day simple moving average) indicate a long-term uptrend.

The Coinbase Chart: Coinbase printed a higher low on Wednesday at $61.18, which negated its downtrend. On Friday, the stock formed a higher high. Wednesday’s retracement back tested the 200-day simple moving average (SMA), which gave bulls confidence a larger move to the upside was on the horizon.

• If Coinbase is able to remain above the 200-day SMA for another day or two, the 50-day SMA will cross above the 200-day, which will cause a golden cross to form on Coinbase’s chart, which will suggest a longer-term bull cycle could be on the horizon.
• If Coinbase closes Friday’s trading session near the high-of-day price, the stock will print a bullish kicker candlestick. This could indicate higher prices will come again on Monday.
• If the stock closes the session with a long upper wick, Coinbase will print a shooting star candlestick, which could indicate the local top has occurred and the stock will trade sideways or lower on Monday.
• If Coinbase continues to spike higher on Monday, the stock’s relative strength index (RSI) will reach or exceed the 70% level. If that happens, Coinbase will reach overbought territory, which is likely to indicate a pull back is on the horizon.
• Coinbase has resistance above at $83.32 and $100 and support below at $69.82 and $60.99.