Usman Salis
Coinbase (COIN) just had one hell of a week, jumping 18.82% in two sessions after hitting a golden cross on the charts. The bullish signal fired when the 50-day moving average crossed above the 200-day, and it lined up perfectly with a clean break above $370. The result? Massive volume and a chart that went nearly vertical.
With crypto markets already running hot and Bitcoin sitting pretty above $107,000, the timing couldn't have been better for COIN. The stock has become the go-to play for anyone wanting exposure to crypto without actually buying digital assets, and right now that trade is working beautifully.
But here's the thing - the stock is starting to flash some serious warning signs that traders can't ignore.
COIN's RSI Hits Danger Zone Like November Crash
The RSI just blasted past 80, putting COIN deep in overbought territory. Now, this isn't unusual for Coinbase - the stock loves to run hot. But the last time we saw this setup was back in November 2024, and that didn't end well. COIN dropped 18.21% in just three trading days, and it wasn't a gentle slide down. It was brutal.
What makes this situation sketchy is how far COIN has stretched from its moving averages. The 200-day sits around $236, the 50-day just crossed $241, and the stock is now trading way above both. That's a huge gap underneath with no real support to catch any selling pressure.
When stocks get this extended, corrections can happen fast. There's nothing to cushion the fall except those distant moving averages, and that's a long way down.
What's Next for COIN Stock?
Look, the fundamentals are still solid. Crypto is having another moment, altcoins are picking up steam, and Coinbase is making money hand over fist from all the trading activity. The golden cross is legit bullish signal that usually means good things ahead.
But technical analysis doesn't lie, and right now COIN looks stretched to the max. The RSI is screaming overbought, the stock has run too far too fast, and history says this kind of setup can reverse quickly.
The next few sessions are going to be crucial. If COIN can hold these levels and consolidate without crashing, the golden cross story stays intact. But if we see the same pattern as November, things could get ugly fast. Smart money is probably taking some profits here and waiting to see what happens next.
With Bitcoin still above $107,000 and crypto sentiment staying bullish, COIN has the wind at its back. The question is whether that's enough to overcome the technical warning signs that are flashing red right now.
Usman Salis
