ICP rallies 22%, then slips 8% – What comes next after this volatility?
Despite the recent gains, swing traders would want to see a breakout past key resistances to confirm that an uptrend was in progress once again.
The Vice President of Dfinity Foundation, Lomesh Dutta, said that the rise of AI-powered no-code tools for the generation and evolution of applications will enable secure, stable, tamper-resistant infrastructure.
This could help prevent the kind of outage that many crypto companies and Web3 applications faced in the aftermath of the AWS outage in October.
Dfinity Foundation is a non-profit organization that guides the Internet Computer [ICP] blockchain development.
These statements could have brought ICP back to the public eye, helping explain the recent rally. ICP gained 22.6% from Friday’s low, but has faced a minor pullback in recent hours of trading.
Profit-taking activity wipes out ICP’s November rally
The 3-day chart showed a bearish internal structure and a complete retracement of the November rally from $2.79 to $9.85. It was expected that the $5 and the $4.3 supports would be defended, but these expectations were proven wrong.
The DMI did not show a strong trend in progress, but its confusing signals served to capture the speed of the recent impulse move and the subsequent retracement. The OBV was slowly bleeding lower, and the MACD also displayed bearish momentum.
To flip the structure bullishly, ICP has to move back above $3.78.
The 4-hour chart showcased an imbalance at the $3.2 area, highlighted in white. This imbalance came after a bullish structure break on this timeframe. At the time of writing, ICP was facing a minor price dip, having shed 8.46% in under 12 hours.
The technical indicators were in favor of the bulls, but traders must remember that the higher timeframe structure is still bearish. Until a move beyond $3.78 comes about, traders need to be careful about taking bullish positions.
Assessing the next ICP move
The market-wide sentiment, especially for Bitcoin [BTC], remained mostly bearish. Until this changes bullishly, it remains likely that altcoins that make strong gains will run into heavy sell pressure from profit-taking activity.
Lower timeframe traders can look to buy ICP now, with a stop-loss below the local support at $2.9.
Traders’ call to action- remain bearish
Until the $3.78 level is breached by a 3-day timeframe candle close, swing traders can remain bearish. The 1-day timeframe also highlights the same local resistance as a key swing point.
Final Thoughts
- The rise of AI-powered no-code tools that were brought to public attention recently could have helped Internet Computer post some of its recent gains.
- The price action remained in favor of the bears over the past month, and traders should be wary of going long until the structure shifts bullishly.
Disclaimer: The information presented does not constitute financial, investment, trading, or other types of advice and is solely the writer’s opinion
