This article is for education purposes only, and not to be taken as advice to buy/sell. Please do your own due diligence before committing to any trade/investment.
Are you trading crypto?
Some friends of mine prefer getting into the crypto world indirectly for various reasons.
How can you participate in the rise of crypto indirectly?
Via trading crypto-related stocks such as Coinbase and MicroStrategy.
I think that the shares of Coinbase present a position trading opportunity, so let’s analyze Coinbase now!
Brief History of Coinbase
Source: coinbase.com
Did you know Coinbase was founded by a former Airbnb engineer in 2012?
Coinbase is a crypto trading platform that allows users to trade popular cryptos such as Bitcoin and Ether. Over the years, it has expanded its offerings.
Presently, it’s the most popular crypto exchange in the US. This is heartening to know!
Is Coinbase financially strong and healthy?
Business Model and Financials
Source: tradingview.com
Do you remember the times when the Coronavirus was rampant in 2020?
Many businesses took a huge hit, resulting in layoffs. Governments around the world had to intervene to prevent an economic collapse.
On the contrary, business was booming for Coinbase. It enjoyed an unprecedented growth of 513% in revenue (blue bar), and a staggering 2,760% in net income (yellow bar) in 2021.
This was probably fueled by the dizzying rise in crypto prices in 2021, attracting a huge number of traders into the crypto space.
However, its total revenue and net income have decreased since.
Is this a cause for concern?
I don’t think so because Coinbase is a relatively young company that began publicly trading in 2021.
Should you buy its shares for a position trade?
You’ll find out in the next section.
Technical Analysis on Coinbase (NASDAQ: COIN)
Reading its chart has also been made easy!
You can tell that Coinbase’s share price is in an uptrend by comparing the number of blue (solid and outlined) candles to those in red (solid and outlined). When there are more blue candles, the stock is in an uptrend.
Knowing that Coinbase’s shares are in an uptrend, you’ll want to look out for buying opportunities.
Without any technical tools and fancy drawings, you can tell whether Coinbase is worth a position trade now.
Yes, you read that right.
You don’t need to plot your support and resistance lines, trendlines, and other indicators, such as the MACD (Moving Average Convergence and Divergence).
Do you see a green arrow above the latest candle of Coinbase?
The green arrow can be likened to a Buy signal. However, it works better when paired with the Trend Impulse Factor.
What about this Trend Impulse Factor indicator, you ask?
You’ll want the Trend Impulse Factor indicator’s bar to be dark green when the green arrow is out.
This tells you that bullish momentum is likely to last, so you’ll have a higher chance of profiting from this stock.
So, yes! The time for buying its shares for a position trade is here!
Conclusion
Source: unsplash.com
A look at its financials may hinder many from investing in Coinbase.
However, its price chart, with our proprietary indicators, suggests that buying its shares for a position trade is a good idea.
With the agreement of the indicators, the time to buy its shares for a position trade is here.
Both the arrow and Trend Impulse Factor indicators have been tested and proven. They form the TradersGPS (TGPS) system to help you decipher if a stock is ripe for a position trade. You won’t have to feel in the dark and make wild guesses.
It’ll be a good idea to save this stock in your watchlist and monitor it over the next few weeks.
