[ad_1]
Coinbase Global, Inc COIN popped up over 4% at one point on Tuesday after consumer price index data released by the U.S. Labor Department showed inflation ticked lower in January.
Inflation rose 6.4% last month compared to 6.5% in December, which caused Bitcoin BTC/USD and Ethereum ETH/USD to spike up over 2% and 4%, respectively, although the number came in above the 6.2% expected by economists.
The S&P 500 initially edged about 0.5% higher in reaction to the data before dropping under Monday’s closing price. By 10:30 a.m. the stock market and crypto sector had erased the pump higher, which pressured Coinbase down to near flat.
From a technical analysis standpoint, Coinbase rejected the 200-day simple moving average (SMA) when it moved higher, indicating the stock needs further consolidation under that level before making another attempt to regain the area.
Want direct analysis? Find me in the BZ Pro lounge! Click here for a free trial.
The Coinbase Chart: Coinbase also attempted to regain the 200-day SMA on Friday and failed. The 200-day SMA is an important bellwether indicator that acts as a major area of support and resistance, making it difficult for a stock to break through the area and remain above it on the first few attempts.
- Coinbase has been trading near to the 200-day since Jan. 27, briefly breaking above the area on Feb. 2 before dropping under the level on Feb. 9. When Coinbase fell under the 200-day SMA, the stock also confirmed a new downtrend was intact by printing a lower low.
- Coinbase’s most recent lower high was formed on Feb. 8 at $73.97 and the most recent confirmed lower low was printed on Monday at $53.66. If Coinbase trades lower on Wednesday, Tuesday’s high-of-day will serve as the next higher low within the pattern.
- If Coinbase closes the trading day under the $58 mark, the stock will print a shooting star candlestick, which could indicate lower prices will come again on Wednesday. If that happens, the stock may find support at the 50-day SMA, which is trending at about $48.
- Bullish traders want to see Coinbase chop sideways near to the 200-day SMA and then for big bullish volume to come in and break the stock up above the level. The 50-day SMA is curling up, which is a good sign for the bulls.
- Coinbase has resistance above at $60.99 and $83.32 and support below at $50.34 and $40.15.
Read Next: Coinbase CEO Brian Armstrong Advocates For Clearer Crypto Regulations In Washington D.C.
Photo courtesy of Coinbase.
[ad_2]
Image and article originally from www.benzinga.com. Read the original article here.