Coinbase ($COIN) stock price appears unstoppable on an unprecedented rout amid fears of insider share dump. The shares backing one of the leading cryptocurrency firms, Coinbase Global, Inc. closed on Friday at $124.75, up 0.33%, according to Yahoo Finance. If the pressure hovering above $COIN maintains, the current 2.5% drop — pre-market to $121.71 on Monday will likely deepen.
Coinbase ($COIN) Bleeds As Insiders Sell
Coinbase stock price has performed extremely well over the last few months, increasing from $70 in late October to $186 in early January.
The rally can directly be attributed to the hype that preceded the approval of the spot Bitcoin ETFs in the US. Although Bitcoin and the crypto market corrected following the green light, the ETFs have continued to perform well, with at least $10 billion in volume coming in over the first 24 hours.
Coinbase is a significant player in the ETF market, providing custody services to several ETF operators like BlackRock and Grayscale.
This factor could make $COIN a big contender in the ETF market and, in turn, contribute immensely to its growth and position among other crypto-based stocks like MicroStrategy Incorporated (MSTR).
The implication is such that Coinbase will soon begin receiving fees charged by Bitcoin ETF operators into the custody service. Coinbase would play a crucial role in the growth of BTC ETFs, matching up to firms like State Stree and Bank of New Mellon.
Meanwhile, there have been reports of insider selling of the stock. Experts believe this trend follows the massive increase in price in Q4 2023. So far, at least 45 transactions have been reported in the last three months, and a staggering 54 in six months.
Cumulatively, $COIN stakeholders disposed of 2.1 million shares in one year with a valuation of $262 million based on the current market rate. Some of the major names making the list of insider selling are Brian Armstrong, the company CEO, Emilie Choi, the COO, and Paul Grewal (CLO).
Although insider selling of stock is often considered bad for the shares, in various instances, they are accepted as being logical. For instance, after a substantial price increase.
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Coinbase ($COIN) Price Outlook
Coinbase stock would be fighting to end the downtrend on Monday backed by support provided by the 200 Exponential Moving Average (EMA) (purple) at $116. A daily close above $120 would go a long way to help turn the tables in favor of the bulls.
However, with a vivid sell signal from the Moving Average Convergence Divergence (MACD) indicator, the least resistance could remain downwards.
Coinbase ($COIN) price chart | Tradingview
Traders cannot rule out the possibility of an immediate trend reversal, especially with the MACD likely to flash a buy signal in a short time frame like on the four-hour chart.
Key targets on the upside include the 20 EMA (blue) at $137, the 50 EMA (red) at $143, and $COIN’s December peak at $186. Sliding below the 200 EMA could trigger a sell-off to $100 before the next recovery trend begins.
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