The stock price of Coinbase (COIN) increased by 16% at the close of the last trading session, coinciding with the update by CEO Brian Armstrong that its retail users had accumulated significant amounts of Bitcoin and Ethereum. The purchases showed strong user behavior during the recent market weakness.
Coinbase Retail Activity Coincides With COIN Rally
According to TradingView data, COIN price closed at $164.32 after gaining $23.23 in the last session. The share opened higher at about $141 and kept moving in an upward direction during the trading day.
Meanwhile, a weekly chart provided by analyst Ace demonstrates that COIN has been testing major Fibonacci retracement areas. He expects the next resistance level to be at $186.19, with additional ones at $279.10, $365.48 and $426.98 in case there is increase in momentum.
The analyst also specified that the bigger structure continues to be corrective until COIN recovers $186.19. He maintained that the coin is maintaining the higher-timeframe bullish structure by continuing to trade above $125.81.
The crypto stock price surge is coming after a prediction by Bernstein analysts that COIN will rise to a high of $212, and would take it to another all-time high (ATH) of over $500.
A recent update by Hardik Shah showed that a number of brokerages have reduced their price targets for Coinbase but still retained their Buy ratings. The targets have ranged between a high of $350 and a low of $148 by H.C. Wainwright and Barclays, respectively.
The data revealed that Canaccord Genuity reduced its target to $300 compared to a previous $400 whereas BTIG dropped to its target to $280. Benchmark cut its forecast to $267 while Goldman Sachs dropped theirs $3 lower to $264.
J.P. Morgan reduced its COIN stock valuation to $252 and Deutsche bank reduced theirs to $250. Rosenblatt and Needham also lowered their estimates to $240 and $230, respectively.
Baird adjusted its rating to Neutral and a $165 target whereas Piper Sandler chose a $150 target. Jefferies decreased its estimate to $151 without changing its previous rating.
Retail Balances Remained Despite Price Swings
Armstrong posted that retail users grew or retained their crypto holdings in spite of the crypto price volatility. He referred to the trend as “buying the dip” with a high balance retention.
He noted that the purchasing trends were mainly on Bitcoin and Ethereum. These assets constitute the biggest trading volume on Coinbase. This data is a measure of internal user metric on the leading crypto exchange as opposed to blockchain use.
Armstrong claimed that most customers displayed “diamond hands” behavior during the price drop. Most retail wallet holdings were even higher in February than in December.
However, despite his optimism regarding crypto wallet holdings by Coinbase users, Armstrong recently disposed COIN stocks worth more than $100 million. This added to his history of selling Coinbase stocks over the last year, during which he had sold approximately $500 million of his COIN stock holdings.
In the meantime, Coinbase Q4 earnings came in lower than predicted by Wall Street. The firm registered a net loss of $666.7 million during this period which ended on December 31.