Internet Computer’s (ICP) recent 6.5% price surge has reignited interest among traders, but whether this short-term rally can evolve into a sustained uptrend remains uncertain. Despite the bounce, the broader trend for ICP has remained bearish since March, with key resistance levels still posing significant hurdles.
Over the past 24 hours, ICP climbed from a low of $3.33 to reach highs near $3.67, driven in part by a concentration of short position liquidations around the $3.5–$3.55 range. This cluster of liquidations acted as a magnet for price action, pulling the token upwards as traders rushed to cover their positions. The surge also happened alongside a spike in trading volume, indicating a renewed, albeit cautious, interest from market participants.
However, this upward movement may not be enough to reverse the dominant downtrend. The weekly chart continues to reflect a steady series of lower highs and lower lows, underscoring bearish market sentiment that has persisted since the asset began declining in March. Even significant rallies in major cryptocurrencies like Bitcoin and other altcoins during April and June failed to pull ICP out of its downward trajectory, with October’s sharp sell-off reinforcing this trend continuation.
The current resistance zone lies between $3.7 and $3.75—an area previously identified as a supply zone following the October 10 crash. This level has repeatedly rebuffed bullish attempts to break higher, and a decisive move above this threshold would be required for bulls to regain control. The next critical resistance rests at $3.78, which coincides with another key supply area visible on the daily timeframe.
Technical indicators paint a mixed picture. While the 1-day chart shows a short-term bullish structure, both the Chaikin Money Flow (CMF) and the Awesome Oscillator remain in negative territory. This divergence between price and momentum suggests that the recent recovery might lack the strength to sustain further gains without additional bullish catalysts.
For traders, the $3.7–$3.75 zone is pivotal. A clean breakout followed by a successful retest as support could offer a compelling long entry. Failing that, rejection at this zone could signal a return to the $3.33–$3.5 range, or possibly lower, if selling pressure intensifies.
The role of liquidity clusters in influencing price movements has been particularly evident in ICP’s recent action. Short positions accumulating at specific price levels—such as $3.55—have historically led to quick upward spikes as market makers trigger liquidations. This behavior suggests that traders should keep a close eye on where open interest builds up, as these areas often precede sharp volatility.
Looking at broader market dynamics, ICP’s classification as an “AI and Big Data” token may position it for future relevance, especially as interest in AI-integrated blockchain solutions grows. However, until this narrative materializes into consistent demand, price action is likely to remain technical in nature rather than fundamentally driven.
Long-term investors should also consider the macroeconomic context. With global monetary policy tightening and risk assets under pressure, speculative cryptocurrencies like ICP may face continued headwinds. A shift in investor sentiment or a macroeconomic pivot could provide the external catalyst needed for a meaningful trend reversal.
In terms of support levels, if bulls fail to break through $3.75, the next key defense lies at the $3.33 mark, where the recent bounce originated. This area has proven to be a liquidity pocket where buyers have previously stepped in, so a breakdown below it would be a strong bearish signal.
The psychological significance of round numbers should not be underestimated either. The $3.00 level, while not yet tested in this cycle, could act as a major support or panic trigger depending on how price approaches it. Similarly, a rally to $4.00, if achieved, could bring in sidelined buyers, especially if accompanied by improved volume and momentum indicators.
From a risk management perspective, traders should remain cautious until ICP establishes a clear trend reversal on higher timeframes. The current setup favors short-term scalps or range-bound strategies rather than aggressive long positions. Waiting for confirmation through volume, momentum, and structural breakouts is key to avoiding false moves.
In conclusion, while the recent 6.5% surge in ICP’s price has provided a short-term trading opportunity, the broader downtrend remains intact. Key resistance levels at $3.7 and $3.75 must be broken with conviction before a sustainable recovery can be considered. Until then, traders are advised to stay vigilant, monitor liquidity zones, and align their strategies with prevailing market sentiment.