Will Bitcoin Send Coinbase (COIN) Surging Higher⎯Or Will It Be A Pump And Dump?
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When it comes to a stock like Coinbase (COIN), you’re going to want to keep an eye on what the overall crypto market is doing in conjunction with the COIN stock price. As Bitcoin’s price seems to be stabilizing after a drop on the news SpaceX sold its crypto/Bitcoin holdings, we got a pop on the news that the Grayscale Bitcoin ETF may be closer to becoming a reality.
However, that hype quickly subsided and now the price seems to be steadily moving higher at a slow, but consistent, pace. This sets the stage to what could be a move higher for COIN. There are two main levels we want to keep an eye on here. As you can see on my chart in the video below, the level to break through is 85.
If Bitcoin and the rest of the crypto market can continue to build on this upward momentum, we should see COIN gain some of the momentum, as well. If COIN can break through this 85 mark look for a retest and hold above it for an entry that would leave attractive risk/reward for your trade.
If this is the route you decide to take, your stop should be just below this mark, or a percentage/dollar amount you are comfortable losing. Setting your stop should be based on a level and that level should be where you determine your trade to be no longer valid, according to your plan.
Again, we will want to see how the overall crypto market trends in conjunction with COIN making its way to this 85 mark. You can enter this trade early, however, let your postion size reflect that fact. If you enter early and with less confirmation of the trade being valid, you don’t want to go full size.
Remember, we are more so risk managers than we are traders. Our job is not only to make money, but also keep from losing it. Always keep these words in mind, live to trade another day. There will always be more opportunities.
Until then, keep this trade on your watchlist so you do not miss any developments that could lend confirmation to this set-up.
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