A 40% bullish breakout awaits Internet Computer (ICP) on falling wedge formation

Key Internet Computer takeaways

• Internet Computer prices poised for a bullish breakout according to its charts.
• ICP, its native token, is currently in a bearish downtrend with prices in a falling wedge pattern.

NEW DELHI (CoinChapter.com) — The Internet Computer (ICP) token has been declining since its launch in May 2021, with only a few green candles amidst the red ones on its daily chart. However, after crashing by almost 95%, ICP price charts forecast an upward rally for the token.

Created by the Dfinity Foundation, ICP may target a 40% boost after bouncing off its immediate support levels soon.

Forecast-Forecast

ICP has lost 94.28% of its value since its launch, going from $630 on May 10’s open to July 13’s low of $36.002. Moreover, the cryptocurrency seems to be in almost continual downside momentum.

But there appears a catch in the latest downside move, for it appears to be forming a classic bullish reversal structure, known as Falling Wedge. In detail, the technical pattern forms when the price fluctuates inside a pair of falling trendlines that would converge down the slope. The outcome of such downside patterns is typically a price breakout to the upside.

The 50-2H (Violet), 100-2H (Green), and 200-2H (Yellow) Moving Average trend lines are above ICP’s price trends. Thus, the forecast is bearish in the short, mid, and long term. Moreover, the 100-2H and 200-2H MA lines have formed a death cross, which may dent investor confidence. A short-term MA trend line moving below a long-term MA trend line creates a death cross.

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For now, the token’s prices are moving towards its immediate support at $34.63. Resistance for ICP lies at the 61.8% Fib retracement level of $40. The Fibonacci Retracement Levels help forecast support and resistance levels for an asset. Once ICP breaks above the upper trend line, bulls will first target the $40 resistance level. Additionally, if ICP flips the $40 resistance level into support, the breakout will continue upwards, going for the resistance at the 31.8% Fib level of $47.656, a gain of almost 40% from ICP’s support level.

MACD for the Internet Computer token is bearish for now, with the MACD line (difference between 12 EMA and 26 EMA on the 2-hour chart) is moving below the MACD signal line (9-2H EMA of MACD). However, the MACD histogram, which plots the difference between MACD and MACD signal line, is declining, which indicates a trend reversal in favor of bulls soon.

The relative strength index for ICP has a value of 32.11. However, it is moving downwards towards the oversold/undervalued levels. Thus, it provides further support to the chances of a bearish trend reversal.

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At the time of writing, ICP was trading at $35.75, down 4.01% on the day.