Bitcoin chart is breaking down, has another 30% downside from here, Canaccord Genuity predicts

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).”