COIN - Bottomed Out?
Been a while since my last post due to personal circumstances. Now that things are sorted I hope to post again more regularly.
I have been following COIN since its market debut. I guess the timing coinciding with the sell off in the Crypto market took a toll on the stock price. However it also shows a pretty regular post IPO pattern for hype stocks. I barely ever invest in listings early but seek to wait until they bottom out. Hype investors are mostly flushed out and trading focuses more on fundamentals and technicals.
Fundamentals on newly listed stocks is somewhat tricky for the lack of a track record. Here is a snapshot of what we know;
The lack of peers makes it somewhat difficult to interpret these numbers. But I like what I see at this stage.
Technicals
* Tripple Bottom post listing
* Breakout pre Aug-21, typical buy the rumor, sell the fact pattern
* Wedge Formation post 3rd bottom
* Breaking below earnings jump level, forming resistance (R1) with R2 at post earnings high
* Currently trading 56% below IBKR analyst consensus
* Positive MACD, however short short term indicator seems to top out and converge
* RSI approaching neutral territory
My Plan
* Entry level at around R1, awaiting to confirm the positive breakout
* SL at short of tripple bottom, to be adjusted in case uptrend is confirmed
* TP around analyst consensus levels, resulting in a 3:1 ratio
* Happy to hold the stock longer term 6-12 months on current fundamental basis
*Disclaimer: The above is my very personal view and does not represent investment advice in any sort of form. All data has been sourced from publicly accessible information. Conduct your own research before trading and do not trade what you can't afford to loose*
I have been following COIN since its market debut. I guess the timing coinciding with the sell off in the Crypto market took a toll on the stock price. However it also shows a pretty regular post IPO pattern for hype stocks. I barely ever invest in listings early but seek to wait until they bottom out. Hype investors are mostly flushed out and trading focuses more on fundamentals and technicals.
Fundamentals on newly listed stocks is somewhat tricky for the lack of a track record. Here is a snapshot of what we know;
- EBIT 6.79
- RoE 9.85%
- RoI 23.21%
- Tot. Rev. 1.8B
- Gross Profit 1.57B
- Net Income 771m
The lack of peers makes it somewhat difficult to interpret these numbers. But I like what I see at this stage.
Technicals
* Tripple Bottom post listing
* Breakout pre Aug-21, typical buy the rumor, sell the fact pattern
* Wedge Formation post 3rd bottom
* Breaking below earnings jump level, forming resistance (R1) with R2 at post earnings high
* Currently trading 56% below IBKR analyst consensus
* Positive MACD, however short short term indicator seems to top out and converge
* RSI approaching neutral territory
My Plan
* Entry level at around R1, awaiting to confirm the positive breakout
* SL at short of tripple bottom, to be adjusted in case uptrend is confirmed
* TP around analyst consensus levels, resulting in a 3:1 ratio
* Happy to hold the stock longer term 6-12 months on current fundamental basis
*Disclaimer: The above is my very personal view and does not represent investment advice in any sort of form. All data has been sourced from publicly accessible information. Conduct your own research before trading and do not trade what you can't afford to loose*
Note
Bottom of wedge broken in last weeks trading session but claimed back shortly after. I wont annul the wedge just yet but would want to see definite confirmation of breaking above R1 before having the confidence to enter a trade.Note
Wedge failed. Now eying Aug-19 lows around $240 as next support.Still confident in the recovery trend, however current momentum might enable some cheaper entry. Confident in upside as long as triple bottom holds
Note
Struggling with R1 despite generally bullish market sentiment. Stock might dip lower again over coming days which would open the window for a buying opportunity.Note
$240 seems to provide demand (support) at this stage post the early September pullback. Overall market is somewhat directionless caught between positive fundamentals and fears of inflation, affecting markets in general.
Will take a passive stance here, monitoring price action. If current levels hold I'd consider taking a small long position at current levels.
Disclaimer
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