Ethereum News

Bitcoin price may still drop 40% after FTX ‘Lehman moment’ — analysis

Bitcoin price may still drop 40% after FTX 'Lehman moment' — analysis

Bitcoin (BTC) saw a fresh rejection at $17,000 on Nov. 18 as nervous markets weathered more FTX fallout.

BTC/USD 1-hour candle chart (Bitstamp). Source: TradingView

BTC gets $12,000 price target

Data from Cointelegraph Markets Pro and TradingView showed BTC/USD failing to flip $17,000 to support — a trend in place for almost a week.

The pair, like major altcoins, remained firmly tied down by cold feet over the FTX debacle and its knock-on effects for various crypto businesses.

For analysts, the outlook remained just as grim, with already dismal forecasts worsening in light of recent events.

“This underperformance of all crypto assets is here to stay until the bulk of uncertainly has cleared up – likely only near the turn of the new year,” trading firm QCP Capital wrote in its latest circular to Telegram channel subscribers on the day.

In an extensive market summary, QCP wrote that its price forecasts for both Bitcoin and Ether (ETH) now had to drop to reflect the impact of FTX.

Updating a prognosis based on Elliott Wave theory from June, it confirmed BTC/USD now had a target of $12,000 and ETH/USD $800.

“As a side-note, crypto markets have been trading akin to commodities ever since the 2017 top – with extended Wave 5s as the longest wave,” the post added.

“Hence such potential price action with new lows into the new year would be characteristic of previous bear market sell-offs.”

An accompanying chart highlighted the divergence between crypto and stocks in November, correlation between them firmly shaken thanks to crypto’s underperformance.

BTC/USD vs. ETH/USD vs. S&P 500 chart. Source: QCP Capital

Popular trader and analyst Cantering Clark meanwhile noted that if the current bear market in risk assets were to copy the Global Financial Crisis, heavy losses were still to come.

“The Lehman bankruptcy was the climax of the 2008 financial crisis. It was bottom material qualitatively, but the market paused and then committed to 40% lower,” part of a tweet

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