In the wake of the FTX failure last month, cryptocurrencies remain lower than they’ve been all year and could stay that way for a long time, according to technical analysts at Canaccord Genuity. “The recent breakdown by bitcoin and [ether] below important support near $18,431 and $1,256, respectively, confirms they are in new intermediate-term downtrends,” analyst Javed Mirza said in a note Thursday. “This is a strong technical negative and opens the door for a test of major support near $11,918 and $560, respectively, or another 30% and 57% downside from current levels.” A move toward those levels “is likely to see a longer-term consolidation, by time,” he added. On Wednesday, bitcoin crossed over the $17,000 level for the first time in two weeks, according to Coin Metrics. It hovered around that mark on Thursday morning. Ether was trading at about $1,200. Mirza also said a short-term, one- to two-week bounce is underway in both cryptocurrencies. That could take bitcoin and ether higher by 27% and 15%, respectively. In order to confirm that immediate-term uptrend, there would need to be a multi-day close above their 200-day moving averages, $21,465 and $1,481, respectively. Despite the damage to the industry caused by the FTX collapse in what was already a bad market, crypto is no stranger to volatility and crashes. It could take time before crypto prices begin to reflect the long-term value of the underlying blockchain technology. “The crypto industry is rhyming with the 1990s internet craze,” Mirza said. “Although the applications of the technology are compelling, it may take a while for the innovation to occur that will drive this technology mainstream. This will likely lead to a similar outcome as bringing the internet to the public, as many of those companies that survived went on to become dominant industry leaders (e.g., Netflix, Google, and Amazon).”
Bitcoin chart is breaking down, has another 30% downside from here, Canaccord Genuity predicts
