Coinbase: How Long Will The February Low Hold?

Over the last year, I followed the monthly machinations of Coinbase’s stock prices (COIN), from its long-term top in the $400s, to the 70% dive into the mid $100s. I have held out COIN as having great long-term investing potential, while expecting to see COIN investors experience much pain in the short to intermediate term. 

My goal is to help COIN investors avoid getting over their skis while they safely accumulate through a bear market. This bear market may bring the most resilient among us to severe frustration. It is not likely to be anywhere near completion. But for those with patience, this bear market gives the opportunity to acquire shares on the cheap. Eventually, provided every level holds, I see COIN rising to four-digit prices in the coming years or decades. 

In my May 2025 article, the first in this series, I held out that a potential long-term top would occur near $400. The ultimate top occurred at $444 in July 2025. That top ushered in a brutal retrace, as I expected. 

In my February article, I stated that I was looking for a significant bounce, which did materialize. What I didn’t know at the time was that bounce had already started. Coinbase bottomed six days prior at $139 and change. That is roughly 69% off of the high. So far, that low has held for two months. 

Is the Bottom in?

Firstly, it is important to ask whether the February low in COIN could be the long-term bottom. While there is a non-zero chance that a bear market low has formed, I can almost rule out that potential. The rally off the February low showed corrective action from the beginning. 

More importantly, it has confirmed a three-wave top with the March high. I would need five waves to $320 to expect new highs off the February low. And I can rule out that those five waves would form an impulse. A diagonal, which is a lower probability structure, is possible. 

Despite this warning, the move down from the March high of $213 seems to have come to completion, as long as $160 holds. As long as $160 holds, I expect another push higher to between $250 and $300. 

As always, I need to take an alternate view. That is necessary for any trader. Risk management is job number one. If $160 breaks, COIN can break down to $115. With respect to my own tactics, I am keeping my exposure small. I am focusing on trading in and out to establish a low cost positon. In my current state, I will only accumulate more at $115, because my current position is light. However, be warned if you are in heavy here and now. You are in for another 50-60% drawdown if $160 breaks. Accumulating in a bear market involves failed setups. I keep my exposure light in such a context. 

Profit Taking At Hand

Naturally, the next question to answer is what happens after a push to between $250 and $300. My primary perspective is that the final bear market decline would commence. Circle-C can take COIN comfortably to $59 without breaking my long-term expectation of COIN reaching four digit, or even five-digit prices. However, $59 is just support, and I need circle-B to top to project a probable bottom target.

That said, tracking corrective patterns is difficult. I start with a basic ABC structure. However, corrective structures often subdivide into more complex ABC structures. Further, a B-wave in this context can briefly break to new all-time highs before trapping breakout traders and returning to bear market action. A move to $250+ will cause me to look for a short setup. However, until a setup materializes, I have to be open to more upward movement. 

Tactically speaking, I plan to keep some exposure to COIN long term as long as it remains over $59. However, the higher COIN goes in corrective structures, will cause me to reduce exposure as it goes without taking exposure to zero. When an impulse forms that is large enough to take COIN up and out of this market, I will get aggressive. 

Conclusion

After a drop of 70% since the all-time high, COIN may seem like a bargain. However, the structure off the recent low is clearly corrective. The current move off of the February low is an opportunity to reduce exposure or take profit if you happened to buy the recent lows. 

Bear markets often give strong rallies, although structure moves in ABC structures, not the five-wave impulses that initiate long-term moves. In conclusion, I urge you not to get over your skis. My tactic is to use these machinations to hold a core, while lowering the cost of that core with short-term trades. If by chance it gets away from me, I have exposure. I’ll take it as a gift. I don’t want to take on aggressive exposure until it is clearly setting up for breaks. Risk management is job #1 of a trader, especially in the context of a bear market.