Analyzing Internet Computer’s [ICP] 6.5% Price Surge – Traders, Take Note of This Next Step

Internet Computer (ICP) experienced a significant 6.5% price surge within 24 hours, likely driven by liquidations at the $3.5 mark. Despite this gain, the long-term trend remains bearish since March, indicating cautious trading ahead.

Key Takeaways

The surge in ICP’s price to $3.67 was likely influenced by short liquidations around the $3.5 region along with heightened trading volumes.
A sustainable recovery seems unlikely for ICP, which has faced a downward trend since March, keeping its weekly structure bearish.
ICP was categorized by CoinMarketCap as an “AI and Big Data” token, trading within a supply zone that has resisted prices since mid-October.
The weekly chart shows a consistent downtrend since March, with prior rallies in Bitcoin (BTC) and large-cap altcoins failing to reverse this trend.

ICP gains momentum on short squeeze but faces supply zone at $3.78

What Drove the Price Bounce for ICP, and What's Next?

ICP Liquidation Heatmap

Source: CoinGlass

On November 1st, ICP prices dropped to the liquidity level at $3.33. Before falling further, the prices managed to bounce back to $3.5, where they remained stable for almost a day. During this period, significant short liquidations accumulated at the $3.55 mark.

This accumulation of liquidity helped propel ICP prices higher on November 2nd, reaching up to $3.67 before facing another decline. Typically, prices tend to move toward liquidity clusters before either reversing or continuing their movement based on the existing trend. Currently, the next key level to watch is between $3.7 and $3.75.

However, it's important to note that the broader market trend does not lean completely bullish.

Rising Volume with Decreasing Momentum

ICP 1-day Chart

Source: ICP/USDT on TradingView

The 1-day chart indicates a bullish trend, yet also highlights a critical supply zone at $3.78. Although there was significant trading volume on November 1st, both the Chaikin Money Flow (CMF) and the Awesome Oscillator remained below zero, indicating ongoing bearish momentum for ICP.

In summary, traders should exercise caution in the current environment. A breakout above $3.8 accompanied by a retest could present an opportunity to buy.

Disclaimer: The views expressed in this article do not constitute financial, investment, trading, or any form of advice and reflect solely the opinion of the writer.