Coinbase (COIN) analysis: How low can the price go?

Coinbase faces selling pressure

The price of Coinbase (COIN) has fallen once again, dropping from $187 at Wednesday’s open to a current price zone between $167.85 and $169.03. This decline comes as a surprise, especially since it occurs in a theoretically favorable regulatory climate in the United States and while Bitcoin is flirting with the top of its range at $73,000.

Indeed, the chairs of the SEC and the CFTC have publicly supported Treasury Secretary Scott Bessent’s call for Congress to pass the CLARITY Act. The period from April 13 to 20 also promises to be decisive with the banking committee meetings. However, this institutional support has not been enough to stem the selling pressure, giving way to a bearish sentiment in the short term. 

As a reminder, Coinbase has faced significant criticism as the exchange and Brian Armstrong continue to oppose and slow down the development of this Clarity Act.

Is Coinbase’s key support in danger?

In terms of technical analysis, the situation for COIN stock is critical. Sellers have pushed the price down to test a major support level located at $167. Indeed, this price corresponds to its major HTF trendline.

The asset’s ability to close above this level is crucial to avoid panic. A confirmed breakdown below this line of defense could trigger a massive new retracement, with a bearish target identified around $95. This zone corresponds to a weekly order block and a major liquidity pool.

The asset has hit an oversold zone on its weekly RSI, meaning the bottom is closer than not. For now, it is time for patience and observation. Monday’s open will be decisive in seeing whether the bulls defend this trendline or not.

Can COIN stock reignite a bullish rally?

Despite this gloomy picture, a bullish scenario remains possible if buyers fiercely defend the $167 mark. A bounce off this level would validate the formation of a double bottom, a classic reversal pattern in trading. To confirm this trend reversal, the RSI must imperatively cross back above the 50 mark on the LTF, signaling the return of buying strength.

If this bounce materializes, the first major hurdle will be the 50 day exponential moving average (EMA), located at $190. A clean breakout above this resistance would then pave the way toward the next price target set at $210, which corresponds to a liquidity zone protected by smart money. Then, if this major resistance is broken, the next targets to watch are at $274 (3 day order block) and between $316 and $400, which corresponds to the area near the ATH.

With upcoming regulatory announcements, volatility is likely to explode. In this uncertain context, how far can the price of Coinbase (COIN) go before the next surge?

Brian Armstrong’s latest statements could well revive investor confidence. “Now is the time to pass the Clarity Act,” he stated this Friday.

Should you buy COIN stock?

The trading community remains divided. Indeed, the bulls highlight Coinbase’s successful diversification (USDC, staking, institutional custody, expansion into derivatives via Deribit, and potential tokenization) and its positioning as an “Everything Exchange” to overtake Robinhood. 

Optimists therefore see strong leverage on a crypto market rebound, with consensus targets around $235 to $260 (up to $300 to $400 in optimistic scenarios). Moreover, Goldman Sachs and others maintain a Buy rating, estimating a 30 to 50% upside if Bitcoin stabilizes and institutional adoption accelerates.

Conversely, Barclays recently downgraded the stock to Underweight (with a $140 target), citing “profitability pressure” and a lack of valuation support amid slowing volumes. Some analysts fear that operating margins will contract if the crypto bear market and this consolidation persist: 

“Despite a pro crypto president and a favorable regulatory environment, overall crypto trading activity has fallen to levels not seen since late 2023. Even though Coinbase is multiplying strategic initiatives (diversification, institutional, tokenization), the decline in volumes will weigh on profitability. With limited valuation support, we are downgrading to Underweight.”

In conclusion, it will likely be necessary to wait until the end of the second quarter before jumping into Coinbase stock. Alternatively, wait for confirmation with a monthly close above $210.

Sources:

• TradingView
• CoinGape
• WallSTEngine
• Brian Armstrong

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