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Can the Coinbase Rally Continue?

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It was only a few short weeks ago where Coinbase (COIN - Free Report) was charged by the SEC for operating as an unregistered securities exchange, broker, and clearing agency.

According to the SEC’s complaint, since at least 2019, Coinbase has made billions of dollars unlawfully facilitating the buying and selling of crypto asset securities. The SEC alleges that Coinbase intertwines the traditional services of an exchange, broker, and clearing agency without having registered any of those functions with the Commission as required by law. Through these unregistered services, Coinbase allegedly:

Provides a marketplace and brings together the orders for securities of multiple buyers and sellers using established, non-discretionary methods under which such orders interact;

Engages in the business of effecting securities transactions for the accounts of Coinbase customers; and

Provides facilities for comparison of data respecting the terms of settlement of crypto asset securities transactions, serves as an intermediary in settling transactions in crypto asset securities by Coinbase customers, and acts as a securities depository.

This news has been looming over Coinbase, but then again, SEC interaction is nothing new for the cryptocurrency platform. Last week, a US Circuit Court Judge ruled that the popular cryptocurrency XRP was not an offer of securities on public cryptocurrency exchanges because purchasers did not have a reasonable expectation of profit that depended on Ripple’s efforts.

That ruling helped continue a rally that has now nearly quadrupled the stock off the lows. How much further can it go?

In today’s Chart of the Day, Dave Bartosiak digs into the technical aspects of the stock’s chart. He looks at areas of potential support and resistance, as well as key indicators which may provide some clues as to where the stock could be heading in the short and intermediate term.


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