Coinbase stock price jumped in the pre-market on Tuesday as the company prepares to join the blue-chip S&P 500 Index. It rose to a high of $223, up by over 57% from its lowest point this year. This article explains why the COIN stock is rising, and why it may surge by at least 70% soon.
Why Coinbase share price is soaring
The COIN share price pumped after it was revealed that it will join the blue-chip S&P 500 Index. Joining this index is always a big deal for companies because of its prestigious nature and the fact that ETF providers are forced to buy its stock.
However, historically, it is common for a company that enters the index to retreat as the added momentum fades.聽
Coinbase stock price is also benefiting from the recent Bitcoin and crypto market surge. Bitcoin has already crossed the important $100,000 milestone, and Ethereum price jumped to $2,500.
While these coins have pulled back, there is a likelihood that they will bounce back after the profit-taking period ends. Besides, the coins will also benefit from the truce between the United States and China, and the prospect for more trade deals.
Read more: Coinbase says SEC set to drop enforcement case against the crypto exchange
COIN鈥檚 results missed estimates
The Coinbase S&P 500 Index inclusion comes a week after the company published its numbers that missed analysts estimates.
Its numbers showed that its revenue stood at $2 billion in the quarter, a 10% drop from what it made in the fourth quarter. This drop was mostly because of the crypto market plunge that happened in the first quarter. Bitcoin and most altcoins, on the other hand, jumped sharply in Q4, leading to more transactions.
Coinbase revenue rose modestly from what it made last year, helped by the diversity of its solutions. Its transaction revenue rose from $1.02 billion to $1.26 billion this year, while its subscription and services figure jumped from $510 million to $696 million.
These numbers show how diversification is helping its business. In addition to the amount it makes per transaction, the company also generates revenue from the stablecoins that are deposited in its platform. Its blockchain rewards, interest, and finance fees are also a core part of its business.
Coinbase stock price is always impacted by the price of Bitcoin. In most cases, it jumps whenever Bitcoin is soaring, and vice versa. As such, it will likely keep rising as analysts predict that Bitcoin will soar to a new all-time high soon.
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Coinbase stock price analysis
COIN stock chart | Source: TradingView
The daily chart shows that the COIN share price bottomed at $145.78 in April. This was a notable level since it coincided with its lowest point in September last year. The stock has now formed a bullish flag pattern, a popular bullish continuation sign. It has also moved above the 50-day and 100-day moving averages.
Therefore, the stock will likely continue soaring as bulls target the double-bottom鈥檚 neckline at $350, up by 70% above the current level. The bullish outlook will become invalid if the stock crashes below the support at $150.
Read more: Coinbase stock has a hidden catalyst in 2025: Base blockchain
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