The Internet Computer (ICP) has recently faced significant price volatility, undergoing a substantial retracement despite a brief rally. Amidst this technical analysis, a statement from the Dfinity Foundation's VP, Lomesh Dutta, suggests a future where AI-powered no-code tools could bolster secure and tamper-resistant infrastructure, potentially bringing ICP back into the spotlight.
ICP's Bearish Trajectory and Key Resistance
ICP's price action has been decidedly bearish following a robust November rally from $2.79 to $9.85, which has since been completely retraced. The 3-day chart reveals a bearish internal structure, with critical support levels at $5 and $4.3 failing to hold. Technical indicators like the On-Balance Volume (OBV) show a steady decline, and the Moving Average Convergence Divergence (MACD) reinforces bearish momentum. For ICP to shift its structure bullishly, a decisive move above the $3.78 mark is crucial. Despite some fleeting bullish signals on the 4-hour chart, indicating a potential imbalance at $3.2 and temporary upward shifts, these are overshadowed by the overarching bearish sentiment on higher timeframes. The broader cryptocurrency market, particularly Bitcoin (BTC), remains bearish, which exerts downward pressure on altcoins, leading to swift profit-taking that can erase gains.
Strategic Trading Outlook Amid Uncertainty
Given the prevailing market conditions, caution is paramount for traders considering bullish positions on ICP. Swing traders are advised to maintain a bearish stance until a confirmed close above the $3.78 resistance level on the 3-day timeframe. While lower timeframe traders might identify opportunities for short-term buys, these should be approached with extreme prudence and a strict stop-loss below the local support at $2.9, acknowledging the inherent risks of trading against a dominant bearish trend.
